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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, 08 May 12
DRY BULK MARKET LOOKING FOR NEW DIRECTION THIS WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the BDI (Baltic Dry Index) the main benchmark of the dry bulk shipping industry not traded at the start of this week, traders, charterers and s ...
Monday, 07 May 12
INDONESIAN HBA FALL AGAIN IN MAY 2012
COALspot.com - Indonesian HBA fall again to lowest level since January 2011 in May 2012. The monthly coal reference price for coal sales in Ma ...
Sunday, 06 May 12
INDONESIAN SUB-BITUMINOUS COAL & CFR SOUTH CHINA SWAPS SLIGHTLY DROP THIS WEEK
COALspot.com - Indonesian sub-bituminous coal swaps and CFR South China coal contracts for June deliveries slightly dropped this week.
According ...
Sunday, 06 May 12
S7 & S8 ROUTES LIKELY TO BE FIRM NEXT WEEK VISTAAR SINGAPORE
COALspot.com - The BDI remained flat this week and was up just by 1 point closing at 1,157 points.
The cape size index was up by 5.14 pct closing ...
Sunday, 06 May 12
EXPORT DUTY ON MINERAL FINALLY TO BECOME EFFECTIVE NEXT WEEK
COALspot.com - Mineral ore exporters of Indonesia ( only IUP holders) are required to obtain recommendation letter from the energy and mineral ...
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- Vijayanagar Sugar Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Global Business Power Corporation, Philippines
- Vizag Seaport Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Tata Chemicals Ltd - India
- Mjunction Services Limited - India
- Bukit Makmur.PT - Indonesia
- Siam City Cement PLC, Thailand
- AsiaOL BioFuels Corp., Philippines
- CIMB Investment Bank - Malaysia
- Kapuas Tunggal Persada - Indonesia
- Bhatia International Limited - India
- Petron Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Deloitte Consulting - India
- Bukit Baiduri Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Toyota Tsusho Corporation, Japan
- European Bulk Services B.V. - Netherlands
- Pipit Mutiara Jaya. PT, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Sindya Power Generating Company Private Ltd
- Chamber of Mines of South Africa
- Borneo Indobara - Indonesia
- Medco Energi Mining Internasional
- Vedanta Resources Plc - India
- Bhoruka Overseas - Indonesia
- Singapore Mercantile Exchange
- Electricity Generating Authority of Thailand
- GN Power Mariveles Coal Plant, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Aboitiz Power Corporation - Philippines
- Rio Tinto Coal - Australia
- Kumho Petrochemical, South Korea
- Karaikal Port Pvt Ltd - India
- Australian Coal Association
- Simpson Spence & Young - Indonesia
- PowerSource Philippines DevCo
- ICICI Bank Limited - India
- Riau Bara Harum - Indonesia
- The Treasury - Australian Government
- Jindal Steel & Power Ltd - India
- Formosa Plastics Group - Taiwan
- Metalloyd Limited - United Kingdom
- Miang Besar Coal Terminal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Larsen & Toubro Limited - India
- Electricity Authority, New Zealand
- GAC Shipping (India) Pvt Ltd
- Savvy Resources Ltd - HongKong
- Orica Mining Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Parliament of New Zealand
- Ind-Barath Power Infra Limited - India
- White Energy Company Limited
- Power Finance Corporation Ltd., India
- Agrawal Coal Company - India
- Bahari Cakrawala Sebuku - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- PNOC Exploration Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Indo Tambangraya Megah - Indonesia
- Energy Development Corp, Philippines
- Coastal Gujarat Power Limited - India
- Videocon Industries ltd - India
- Thiess Contractors Indonesia
- Ministry of Transport, Egypt
- Timah Investasi Mineral - Indoneisa
- Indogreen Group - Indonesia
- Central Java Power - Indonesia
- IEA Clean Coal Centre - UK
- Planning Commission, India
- Carbofer General Trading SA - India
- Bharathi Cement Corporation - India
- Orica Australia Pty. Ltd.
- Madhucon Powers Ltd - India
- Malabar Cements Ltd - India
- Grasim Industreis Ltd - India
- Binh Thuan Hamico - Vietnam
- VISA Power Limited - India
- Uttam Galva Steels Limited - India
- Economic Council, Georgia
- Kepco SPC Power Corporation, Philippines
- Eastern Energy - Thailand
- Merrill Lynch Commodities Europe
- SMC Global Power, Philippines
- Indonesian Coal Mining Association
- Ministry of Mines - Canada
- Maharashtra Electricity Regulatory Commission - India
- South Luzon Thermal Energy Corporation
- Bhushan Steel Limited - India
- Heidelberg Cement - Germany
- Mercator Lines Limited - India
- Interocean Group of Companies - India
- Energy Link Ltd, New Zealand
- Kalimantan Lumbung Energi - Indonesia
- Sree Jayajothi Cements Limited - India
- Holcim Trading Pte Ltd - Singapore
- Antam Resourcindo - Indonesia
- Oldendorff Carriers - Singapore
- Dalmia Cement Bharat India
- Cement Manufacturers Association - India
- Indian Energy Exchange, India
- GVK Power & Infra Limited - India
- Port Waratah Coal Services - Australia
- Marubeni Corporation - India
- The University of Queensland
- Siam City Cement - Thailand
- Therma Luzon, Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- Samtan Co., Ltd - South Korea
- Gujarat Electricity Regulatory Commission - India
- Independent Power Producers Association of India
- Asmin Koalindo Tuhup - Indonesia
- CNBM International Corporation - China
- Global Coal Blending Company Limited - Australia
- Manunggal Multi Energi - Indonesia
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Commonwealth Bank - Australia
- Standard Chartered Bank - UAE
- Meenaskhi Energy Private Limited - India
- India Bulls Power Limited - India
- Pendopo Energi Batubara - Indonesia
- Indian Oil Corporation Limited
- Directorate Of Revenue Intelligence - India
- Salva Resources Pvt Ltd - India
- Wilmar Investment Holdings
- Straits Asia Resources Limited - Singapore
- Jaiprakash Power Ventures ltd
- SMG Consultants - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ceylon Electricity Board - Sri Lanka
- Jorong Barutama Greston.PT - Indonesia
- Kaltim Prima Coal - Indonesia
- Gujarat Sidhee Cement - India
- Edison Trading Spa - Italy
- Central Electricity Authority - India
- Price Waterhouse Coopers - Russia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Georgia Ports Authority, United States
- ASAPP Information Group - India
- Sojitz Corporation - Japan
- Parry Sugars Refinery, India
- Sinarmas Energy and Mining - Indonesia
- Lanco Infratech Ltd - India
- Mintek Dendrill Indonesia
- Trasteel International SA, Italy
- TNB Fuel Sdn Bhd - Malaysia
- Karbindo Abesyapradhi - Indoneisa
- Aditya Birla Group - India
- GMR Energy Limited - India
- Sakthi Sugars Limited - India
- OPG Power Generation Pvt Ltd - India
- Sical Logistics Limited - India
- Ambuja Cements Ltd - India
- Kideco Jaya Agung - Indonesia
- Baramulti Group, Indonesia
- Eastern Coal Council - USA
- Goldman Sachs - Singapore
- Indika Energy - Indonesia
- The State Trading Corporation of India Ltd
- Wood Mackenzie - Singapore
- San Jose City I Power Corp, Philippines
- Meralco Power Generation, Philippines
- Australian Commodity Traders Exchange
- New Zealand Coal & Carbon
- Globalindo Alam Lestari - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Minerals Council of Australia
- Bangladesh Power Developement Board
- Romanian Commodities Exchange
- Coalindo Energy - Indonesia
- Xindia Steels Limited - India
- Star Paper Mills Limited - India
- Bayan Resources Tbk. - Indonesia
- TeaM Sual Corporation - Philippines
- International Coal Ventures Pvt Ltd - India
- Africa Commodities Group - South Africa
- Chettinad Cement Corporation Ltd - India
- McConnell Dowell - Australia
- Bulk Trading Sa - Switzerland
- Neyveli Lignite Corporation Ltd, - India
- SN Aboitiz Power Inc, Philippines
- PTC India Limited - India
- Kobexindo Tractors - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Semirara Mining Corp, Philippines
- Essar Steel Hazira Ltd - India
- Coal and Oil Company - UAE
- Latin American Coal - Colombia
- Posco Energy - South Korea
- Ministry of Finance - Indonesia
- Sarangani Energy Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Thai Mozambique Logistica
- Cigading International Bulk Terminal - Indonesia
- Mercuria Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Renaissance Capital - South Africa
- Directorate General of MIneral and Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- Banpu Public Company Limited - Thailand
- MS Steel International - UAE
- Tamil Nadu electricity Board
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