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Friday, 06 April 12
DRY BULK MARKET SWIFT TO HALT FALL ON RENEWED DEMAND FOR CAPESIZES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 The dry bulk managed to put a stop to the recent falls, which came as a result of a lacklustre demand for smaller vessel sizes. Although this trend has remained the same, the return of Chinese charterers from their three-day holidays marked a stronger demand for Capesizes yesterday, which in turn was enough to offset the lack of interest for smaller vessels and lead the market to higher ground. The Baltic Dry Index (BDI) was up by 0..22% to 928 points yesterday, with Capesizes gaining 2.17% on the day and reaching 1,507 points. By contrast, the demise of the Supramax market was again evident, with the relative index losing 1.66%, while Panamaxes were also down by 0.67%.
Detailing the oversupply issues which have caused the dry bulk market to retreat to such low levels since the start of the year, Intermodal’s Theodore Ntalakos said that “the freight market and other circumstances were quite convenient for many shipowners who while acting independently and rationally consulting their own self-interest, ordered new buildings even when it was clear that in the long-term the excessive tonnage would eventually suffocate the freight market. It is a real-life example of game theory that shows why two or more individuals might not cooperate, even if it is in their best interest to do so” said Mr. Ntalakos.
He went on to give an example to make his case. “Say we have one shipowner ( Shipowner A) and all the rest shipowners (Shipowner B). Each of their strategy is either to expand by ordering the new fuel efficient vessels or not to order and buy a vessel from the second hand market. We have four possible scenarios:
I. If Shipowner A orders and no one else does then he will get the benefit of new designs, and earn say $10, B stays behind and earns $1
II. If both A and B order then they lose the advantage and they earn very little - $2,
III. If no one orders then they earn moderately from their existing fleet - $5 each, and
IV. If shipowner A does not order but 'B' orders then 'A' will earn very little because the charterers will prefer B's ECO ships – A earns $1, B earns $10.
Here, regardless of what the other decides, each shipowner gets a higher pay-off by ordering new vessels:
I. If B does not order, the payoffs for A are $5 or $10 so he will always chose $10 i.e to order.
II. If B orders, the payoffs for A are $1 or $2 so he will always chose $2 i.e to order
The game is symmetric so Shipower B would always act the same way which means that both shipowers would order new vessels. Since both rational owners decide to order new vessels each receives a lower reward than if both were not to order!! So, rational decision-making results being worse off than if each chose not to order and accept to earn less. As the two shipowners can’t see what the others are doing and cannot play a cooperative game, they will decide to maximize their pay-off and always proceed with orders” said Mr. Ntalakos in a rather interesting undertaking.
He concluded his analysis by stating “we need however to point out that the new ECO ships especially with the current restrain on finance, will only be a small part of the total fleet and orderbook and it will take years to play a substantial part and drive the older vessels out of the market, so we expect owners who order such vessels with today's new builiding and bunker prices to have the competitive advantage for the years to come.
So, there you have it, Shipping is a non-cooperative game. Then why do pools exist? Even in pools if each member's interest to put the next (and succeeding) vessel he acquires into the pool and the demand is limited then the quality of the common is damaged for everybody. So like everything else in life one needs to find the proper equilibrium between cooperating and looking after one's self-interest” he said.
Source: Nikos Roussanoglou, Hellenic Shipping
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Tuesday, 22 May 12
NEW ONE-YEAR TIME CHARTERS FOR TWO VESSELS OF EXCEL MARITIME CARRIERS LTD.
Excel Maritime Carriers Ltd. (NYSE: EXM), an owner and operator of dry bulk carriers and an international provider of worldwide seaborne transportat ...
Tuesday, 22 May 12
DRY BULK MARKET STEADY, AWAITING FURTHER RISE IN DEMAND WHICH IS DOUBTFUL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Traditionally, the second and third quarters of the year are the strongest for the dry bulk market, but this year, things seem to be quite subdued, ...
Sunday, 20 May 12
SPOT FREIGHT RATE DIPS FURTHER - VISTAAR
COALspot.com - The BDI was marginally up by 3 points (0.26 pct) closing at 1,141 points.
The cape index was up by 1.17 pct closing at 1,633 point ...
Saturday, 19 May 12
INDONESIAN SUB-BITUMINOUS COAL SWAPS DROP US$ 2.88 PMT W-O-W
COALspot.com - Indonesian sub-bituminous coal swaps and CFR South China coal contracts for June deliveries have drops this week by 3.86 percent and& ...
Saturday, 19 May 12
INDONESIAN EXPORT TAX GIVES COAL MINERS A CHEAP RIDE: ANALYSTS - THE JAKARTA GLOBE
The Jakarta Globe reported that, Indonesia’s policy to exclude coal from an export tax that has been applied to 14 other mineral commodities h ...
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- Manunggal Multi Energi - Indonesia
- Thai Mozambique Logistica
- Australian Commodity Traders Exchange
- Latin American Coal - Colombia
- Mintek Dendrill Indonesia
- LBH Netherlands Bv - Netherlands
- South Luzon Thermal Energy Corporation
- Binh Thuan Hamico - Vietnam
- Global Business Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Power Finance Corporation Ltd., India
- SMG Consultants - Indonesia
- Indian Energy Exchange, India
- Singapore Mercantile Exchange
- The Treasury - Australian Government
- Africa Commodities Group - South Africa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Oldendorff Carriers - Singapore
- Straits Asia Resources Limited - Singapore
- Borneo Indobara - Indonesia
- Xindia Steels Limited - India
- Eastern Coal Council - USA
- Alfred C Toepfer International GmbH - Germany
- Commonwealth Bank - Australia
- Leighton Contractors Pty Ltd - Australia
- Parliament of New Zealand
- Eastern Energy - Thailand
- Videocon Industries ltd - India
- Bharathi Cement Corporation - India
- Vijayanagar Sugar Pvt Ltd - India
- Central Electricity Authority - India
- Malabar Cements Ltd - India
- Aboitiz Power Corporation - Philippines
- Aditya Birla Group - India
- Renaissance Capital - South Africa
- TeaM Sual Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Posco Energy - South Korea
- GN Power Mariveles Coal Plant, Philippines
- McConnell Dowell - Australia
- GMR Energy Limited - India
- Australian Coal Association
- Port Waratah Coal Services - Australia
- Merrill Lynch Commodities Europe
- Wood Mackenzie - Singapore
- GVK Power & Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Medco Energi Mining Internasional
- Petrochimia International Co. Ltd.- Taiwan
- Dalmia Cement Bharat India
- Bulk Trading Sa - Switzerland
- The State Trading Corporation of India Ltd
- Banpu Public Company Limited - Thailand
- Jaiprakash Power Ventures ltd
- Essar Steel Hazira Ltd - India
- Anglo American - United Kingdom
- PowerSource Philippines DevCo
- Antam Resourcindo - Indonesia
- Petron Corporation, Philippines
- Siam City Cement - Thailand
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Kumho Petrochemical, South Korea
- Kartika Selabumi Mining - Indonesia
- Vedanta Resources Plc - India
- Indonesian Coal Mining Association
- Sinarmas Energy and Mining - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Larsen & Toubro Limited - India
- Minerals Council of Australia
- Edison Trading Spa - Italy
- Georgia Ports Authority, United States
- SN Aboitiz Power Inc, Philippines
- Madhucon Powers Ltd - India
- Metalloyd Limited - United Kingdom
- Goldman Sachs - Singapore
- Cement Manufacturers Association - India
- Indo Tambangraya Megah - Indonesia
- San Jose City I Power Corp, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Tata Chemicals Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Iligan Light & Power Inc, Philippines
- Orica Mining Services - Indonesia
- Trasteel International SA, Italy
- Therma Luzon, Inc, Philippines
- Sojitz Corporation - Japan
- Attock Cement Pakistan Limited
- Global Green Power PLC Corporation, Philippines
- Carbofer General Trading SA - India
- IHS Mccloskey Coal Group - USA
- Coal and Oil Company - UAE
- Chamber of Mines of South Africa
- Makarim & Taira - Indonesia
- Orica Australia Pty. Ltd.
- Jindal Steel & Power Ltd - India
- Planning Commission, India
- Kideco Jaya Agung - Indonesia
- Samtan Co., Ltd - South Korea
- Energy Development Corp, Philippines
- ICICI Bank Limited - India
- Sakthi Sugars Limited - India
- Uttam Galva Steels Limited - India
- Deloitte Consulting - India
- Mercator Lines Limited - India
- Altura Mining Limited, Indonesia
- SMC Global Power, Philippines
- Kepco SPC Power Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Baramulti Group, Indonesia
- Ministry of Transport, Egypt
- Directorate General of MIneral and Coal - Indonesia
- Coastal Gujarat Power Limited - India
- Indian Oil Corporation Limited
- Heidelberg Cement - Germany
- Pipit Mutiara Jaya. PT, Indonesia
- Bhoruka Overseas - Indonesia
- Energy Link Ltd, New Zealand
- Chettinad Cement Corporation Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Billiton Holdings Pty Ltd - Australia
- Lanco Infratech Ltd - India
- OPG Power Generation Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Electricity Generating Authority of Thailand
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- IEA Clean Coal Centre - UK
- Gujarat Electricity Regulatory Commission - India
- Gujarat Sidhee Cement - India
- Kaltim Prima Coal - Indonesia
- The University of Queensland
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Wilmar Investment Holdings
- Bhatia International Limited - India
- Semirara Mining Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Simpson Spence & Young - Indonesia
- European Bulk Services B.V. - Netherlands
- Meralco Power Generation, Philippines
- Maheswari Brothers Coal Limited - India
- Coalindo Energy - Indonesia
- Central Java Power - Indonesia
- Directorate Of Revenue Intelligence - India
- Meenaskhi Energy Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Pendopo Energi Batubara - Indonesia
- Tamil Nadu electricity Board
- London Commodity Brokers - England
- Indika Energy - Indonesia
- Electricity Authority, New Zealand
- GAC Shipping (India) Pvt Ltd
- Jorong Barutama Greston.PT - Indonesia
- Star Paper Mills Limited - India
- India Bulls Power Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Mines - Canada
- Riau Bara Harum - Indonesia
- Economic Council, Georgia
- Vizag Seaport Private Limited - India
- CNBM International Corporation - China
- Maharashtra Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Interocean Group of Companies - India
- Sical Logistics Limited - India
- Karaikal Port Pvt Ltd - India
- New Zealand Coal & Carbon
- AsiaOL BioFuels Corp., Philippines
- Mercuria Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Timah Investasi Mineral - Indoneisa
- Sree Jayajothi Cements Limited - India
- Standard Chartered Bank - UAE
- Siam City Cement PLC, Thailand
- Savvy Resources Ltd - HongKong
- Toyota Tsusho Corporation, Japan
- Ministry of Finance - Indonesia
- International Coal Ventures Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bhushan Steel Limited - India
- VISA Power Limited - India
- Agrawal Coal Company - India
- Intertek Mineral Services - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indogreen Group - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Makmur.PT - Indonesia
- Rio Tinto Coal - Australia
- Global Coal Blending Company Limited - Australia
- Independent Power Producers Association of India
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Mineral Development Corp Ltd - India
- MS Steel International - UAE
- White Energy Company Limited
- Mjunction Services Limited - India
- Bangladesh Power Developement Board
- Parry Sugars Refinery, India
- Karbindo Abesyapradhi - Indoneisa
- ASAPP Information Group - India
- Globalindo Alam Lestari - Indonesia
- PTC India Limited - India
- Kapuas Tunggal Persada - Indonesia
- Salva Resources Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Price Waterhouse Coopers - Russia
- Miang Besar Coal Terminal - Indonesia
- Kobexindo Tractors - Indoneisa
- Romanian Commodities Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Ambuja Cements Ltd - India
- Sindya Power Generating Company Private Ltd
- Ind-Barath Power Infra Limited - India
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