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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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Monday, 26 March 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
The Baltic Dry Index follows its upward incline for fourth consecutive week by rising to more than 900 points, up by 37% from the bottom low in the ...
Monday, 26 March 12
GOLDEN MINES FY11 REVENUE JUMPS 209% - INSIDER STORIES
Insider Stories reported that, coal miner PT Golden Energy Mines Tbk (GEMS), that is controlled by Sinar Mas Group, recorded a 209% jump in revenue ...
Saturday, 24 March 12
AUSTRALIA'S MINERAL TAX : BENCHMARK FOR OTHER COUNTRIES - SUNIL K KUMBHAT
COALspot.com - Natural resources rich counties like Australia , Indonesia , South Africa , Brazil etc are going through a spectacular resources boom ...
Saturday, 24 March 12
THE AVERAGE CHARTER RATES WAS AT CAPESIZE $ 4,546 PER DAY VS SUPRAMAX / $ 10,819 PER DAY - VISTAAR
COALspot.com - The BDI crossed 900 points this week closing at 908 points up by 3.89 pct. All other sectors were up except for cape index whic ...
Thursday, 22 March 12
ECI-CHINA HANDY RATES ARE AROUND US$ 8000 - FEARNLEYS
Handy
Another positive trend was seen last week with more cargoes entering the market. Skaw-Passero/US Gulf climbed slowly up to USD 3700, while US ...
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- Gujarat Electricity Regulatory Commission - India
- Rio Tinto Coal - Australia
- Coastal Gujarat Power Limited - India
- Dalmia Cement Bharat India
- Timah Investasi Mineral - Indoneisa
- PNOC Exploration Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Mercator Lines Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- Toyota Tsusho Corporation, Japan
- Orica Mining Services - Indonesia
- New Zealand Coal & Carbon
- Indian Oil Corporation Limited
- Bangladesh Power Developement Board
- Minerals Council of Australia
- Vedanta Resources Plc - India
- Borneo Indobara - Indonesia
- Posco Energy - South Korea
- Ambuja Cements Ltd - India
- Orica Australia Pty. Ltd.
- Krishnapatnam Port Company Ltd. - India
- Kapuas Tunggal Persada - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Wood Mackenzie - Singapore
- Global Green Power PLC Corporation, Philippines
- Baramulti Group, Indonesia
- Makarim & Taira - Indonesia
- TeaM Sual Corporation - Philippines
- Singapore Mercantile Exchange
- Kumho Petrochemical, South Korea
- Planning Commission, India
- GMR Energy Limited - India
- Malabar Cements Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- OPG Power Generation Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- AsiaOL BioFuels Corp., Philippines
- Uttam Galva Steels Limited - India
- Larsen & Toubro Limited - India
- IEA Clean Coal Centre - UK
- Wilmar Investment Holdings
- ASAPP Information Group - India
- Aboitiz Power Corporation - Philippines
- Lanco Infratech Ltd - India
- Cement Manufacturers Association - India
- Medco Energi Mining Internasional
- Miang Besar Coal Terminal - Indonesia
- Bulk Trading Sa - Switzerland
- Simpson Spence & Young - Indonesia
- Australian Commodity Traders Exchange
- Tata Chemicals Ltd - India
- Goldman Sachs - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Attock Cement Pakistan Limited
- The Treasury - Australian Government
- Trasteel International SA, Italy
- Commonwealth Bank - Australia
- Carbofer General Trading SA - India
- Binh Thuan Hamico - Vietnam
- Grasim Industreis Ltd - India
- International Coal Ventures Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- MS Steel International - UAE
- Aditya Birla Group - India
- Essar Steel Hazira Ltd - India
- Heidelberg Cement - Germany
- Karaikal Port Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Bhoruka Overseas - Indonesia
- European Bulk Services B.V. - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Parliament of New Zealand
- Price Waterhouse Coopers - Russia
- Ministry of Mines - Canada
- Ministry of Finance - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement - Thailand
- Altura Mining Limited, Indonesia
- Alfred C Toepfer International GmbH - Germany
- Mercuria Energy - Indonesia
- Indian Energy Exchange, India
- PTC India Limited - India
- Indonesian Coal Mining Association
- Iligan Light & Power Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Kartika Selabumi Mining - Indonesia
- Antam Resourcindo - Indonesia
- Standard Chartered Bank - UAE
- Cigading International Bulk Terminal - Indonesia
- McConnell Dowell - Australia
- Coal and Oil Company - UAE
- Renaissance Capital - South Africa
- Indogreen Group - Indonesia
- Ministry of Transport, Egypt
- Gujarat Sidhee Cement - India
- Savvy Resources Ltd - HongKong
- South Luzon Thermal Energy Corporation
- ICICI Bank Limited - India
- Sindya Power Generating Company Private Ltd
- Riau Bara Harum - Indonesia
- The State Trading Corporation of India Ltd
- TNB Fuel Sdn Bhd - Malaysia
- LBH Netherlands Bv - Netherlands
- Ceylon Electricity Board - Sri Lanka
- Sical Logistics Limited - India
- Port Waratah Coal Services - Australia
- Karbindo Abesyapradhi - Indoneisa
- SN Aboitiz Power Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Globalindo Alam Lestari - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Therma Luzon, Inc, Philippines
- Eastern Coal Council - USA
- Tamil Nadu electricity Board
- Maheswari Brothers Coal Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Agrawal Coal Company - India
- White Energy Company Limited
- Bayan Resources Tbk. - Indonesia
- Central Java Power - Indonesia
- Kepco SPC Power Corporation, Philippines
- Petron Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Metalloyd Limited - United Kingdom
- Deloitte Consulting - India
- Samtan Co., Ltd - South Korea
- Economic Council, Georgia
- Parry Sugars Refinery, India
- Leighton Contractors Pty Ltd - Australia
- Bhatia International Limited - India
- Kobexindo Tractors - Indoneisa
- Star Paper Mills Limited - India
- Sinarmas Energy and Mining - Indonesia
- Power Finance Corporation Ltd., India
- Videocon Industries ltd - India
- PowerSource Philippines DevCo
- San Jose City I Power Corp, Philippines
- CNBM International Corporation - China
- Eastern Energy - Thailand
- Directorate General of MIneral and Coal - Indonesia
- Oldendorff Carriers - Singapore
- Siam City Cement PLC, Thailand
- SMC Global Power, Philippines
- London Commodity Brokers - England
- Edison Trading Spa - Italy
- Bukit Baiduri Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Mintek Dendrill Indonesia
- Romanian Commodities Exchange
- Intertek Mineral Services - Indonesia
- GVK Power & Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- Global Coal Blending Company Limited - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Anglo American - United Kingdom
- Chamber of Mines of South Africa
- Energy Link Ltd, New Zealand
- Electricity Generating Authority of Thailand
- Formosa Plastics Group - Taiwan
- PetroVietnam Power Coal Import and Supply Company
- Madhucon Powers Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- The University of Queensland
- Jorong Barutama Greston.PT - Indonesia
- Electricity Authority, New Zealand
- Meralco Power Generation, Philippines
- Semirara Mining Corp, Philippines
- Directorate Of Revenue Intelligence - India
- Sakthi Sugars Limited - India
- Energy Development Corp, Philippines
- Sojitz Corporation - Japan
- Barasentosa Lestari - Indonesia
- Central Electricity Authority - India
- Salva Resources Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Vizag Seaport Private Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Indika Energy - Indonesia
- Thiess Contractors Indonesia
- Coalindo Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Marubeni Corporation - India
- Merrill Lynch Commodities Europe
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sree Jayajothi Cements Limited - India
- Banpu Public Company Limited - Thailand
- Manunggal Multi Energi - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Mjunction Services Limited - India
- CIMB Investment Bank - Malaysia
- Bharathi Cement Corporation - India
- Ind-Barath Power Infra Limited - India
- Semirara Mining and Power Corporation, Philippines
- Australian Coal Association
- Africa Commodities Group - South Africa
- Thai Mozambique Logistica
- Global Business Power Corporation, Philippines
- SMG Consultants - Indonesia
- Latin American Coal - Colombia
- VISA Power Limited - India
- Jindal Steel & Power Ltd - India
- India Bulls Power Limited - India
- Meenaskhi Energy Private Limited - India
- Kideco Jaya Agung - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Interocean Group of Companies - India
- Bhushan Steel Limited - India
- Independent Power Producers Association of India
- Xindia Steels Limited - India
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