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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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Thursday, 19 January 12
14TH VOGP MEETING IN HO CHI MINH CITY HANDS OUT LATEST UPDATES AND DEVELOPMENTS IN VIETNAM'S ENERGY INDUSTRY
Press Release: At upcoming 14th Vietnam Oil Gas Power on 27-28 Feb in Ho Chi Minh City the industry’s most influential names including Petrovi ...
Thursday, 19 January 12
DELTA DUNIA SEALS US$820 MIO CONTRACT INSIDER STORIES
Insider Stories reported that, PT Delta Dunia Makmur Tbk (DOID) has announced that its primary operating subsidiary, PT Bukit Makmur Mandiri Utama ( ...
Wednesday, 18 January 12
WARM WINTER ACROSS EUROPE HAS IMPACTED NEGATIVELY COAL DEMAND - BRS
With the Chinese New Year just a week away, all markets are slowing down. The drop in freight rates for all sizes has been significant over the past ...
Wednesday, 18 January 12
DRY BULK MARKET'S DRAMA CONTINUES IN START OF NEW WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A flurry of newbuilding deliveries, coupled with a slow start to the new year, a typical trend for the dry bulk market, has led the industry's benc ...
Monday, 16 January 12
BUMA MINED 2.7 MILLION TONS COAL LAST MONTH
COALspot.com - BUMA has mined 2.7 million tons (-14.1% YoY) coal last month and removed 25.8 million bcm (-5.6% YoY) overburden, according to compan ...
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- Billiton Holdings Pty Ltd - Australia
- Bhushan Steel Limited - India
- Malabar Cements Ltd - India
- CNBM International Corporation - China
- Bukit Makmur.PT - Indonesia
- Independent Power Producers Association of India
- Aditya Birla Group - India
- Holcim Trading Pte Ltd - Singapore
- Agrawal Coal Company - India
- McConnell Dowell - Australia
- Essar Steel Hazira Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Coal and Oil Company - UAE
- Salva Resources Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Manunggal Multi Energi - Indonesia
- Indogreen Group - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- International Coal Ventures Pvt Ltd - India
- GVK Power & Infra Limited - India
- Planning Commission, India
- Bhatia International Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meralco Power Generation, Philippines
- Merrill Lynch Commodities Europe
- Orica Australia Pty. Ltd.
- Banpu Public Company Limited - Thailand
- Toyota Tsusho Corporation, Japan
- Mjunction Services Limited - India
- Kumho Petrochemical, South Korea
- Alfred C Toepfer International GmbH - Germany
- Maheswari Brothers Coal Limited - India
- Indian Oil Corporation Limited
- Petron Corporation, Philippines
- Economic Council, Georgia
- Globalindo Alam Lestari - Indonesia
- Bayan Resources Tbk. - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Therma Luzon, Inc, Philippines
- Standard Chartered Bank - UAE
- Ceylon Electricity Board - Sri Lanka
- Eastern Coal Council - USA
- Ministry of Mines - Canada
- Oldendorff Carriers - Singapore
- Power Finance Corporation Ltd., India
- Vijayanagar Sugar Pvt Ltd - India
- Goldman Sachs - Singapore
- Minerals Council of Australia
- PetroVietnam Power Coal Import and Supply Company
- Sinarmas Energy and Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- GMR Energy Limited - India
- MS Steel International - UAE
- PowerSource Philippines DevCo
- Videocon Industries ltd - India
- Ambuja Cements Ltd - India
- ICICI Bank Limited - India
- London Commodity Brokers - England
- Kapuas Tunggal Persada - Indonesia
- Cement Manufacturers Association - India
- Madhucon Powers Ltd - India
- Energy Link Ltd, New Zealand
- SMC Global Power, Philippines
- Carbofer General Trading SA - India
- Singapore Mercantile Exchange
- Gujarat Sidhee Cement - India
- Wood Mackenzie - Singapore
- Star Paper Mills Limited - India
- PTC India Limited - India
- Kaltim Prima Coal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- ASAPP Information Group - India
- Leighton Contractors Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Attock Cement Pakistan Limited
- Riau Bara Harum - Indonesia
- Parry Sugars Refinery, India
- Mercator Lines Limited - India
- CIMB Investment Bank - Malaysia
- Directorate Of Revenue Intelligence - India
- Thiess Contractors Indonesia
- Sical Logistics Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Price Waterhouse Coopers - Russia
- Chamber of Mines of South Africa
- SMG Consultants - Indonesia
- Antam Resourcindo - Indonesia
- Latin American Coal - Colombia
- Indonesian Coal Mining Association
- Borneo Indobara - Indonesia
- Karaikal Port Pvt Ltd - India
- Australian Coal Association
- LBH Netherlands Bv - Netherlands
- Georgia Ports Authority, United States
- The State Trading Corporation of India Ltd
- Rashtriya Ispat Nigam Limited - India
- Indian Energy Exchange, India
- Dalmia Cement Bharat India
- Timah Investasi Mineral - Indoneisa
- Makarim & Taira - Indonesia
- Jindal Steel & Power Ltd - India
- VISA Power Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- Savvy Resources Ltd - HongKong
- Ministry of Transport, Egypt
- Kobexindo Tractors - Indoneisa
- White Energy Company Limited
- Binh Thuan Hamico - Vietnam
- Bukit Baiduri Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Baramulti Group, Indonesia
- Sindya Power Generating Company Private Ltd
- Samtan Co., Ltd - South Korea
- Trasteel International SA, Italy
- Mintek Dendrill Indonesia
- Electricity Authority, New Zealand
- Vedanta Resources Plc - India
- Semirara Mining Corp, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Indo Tambangraya Megah - Indonesia
- Africa Commodities Group - South Africa
- Intertek Mineral Services - Indonesia
- India Bulls Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- TeaM Sual Corporation - Philippines
- Jaiprakash Power Ventures ltd
- The Treasury - Australian Government
- Altura Mining Limited, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Coalindo Energy - Indonesia
- Wilmar Investment Holdings
- Deloitte Consulting - India
- Renaissance Capital - South Africa
- Siam City Cement PLC, Thailand
- Posco Energy - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Heidelberg Cement - Germany
- Vizag Seaport Private Limited - India
- PNOC Exploration Corporation - Philippines
- Commonwealth Bank - Australia
- Ministry of Finance - Indonesia
- Iligan Light & Power Inc, Philippines
- Eastern Energy - Thailand
- Rio Tinto Coal - Australia
- Global Green Power PLC Corporation, Philippines
- Xindia Steels Limited - India
- Simpson Spence & Young - Indonesia
- Tamil Nadu electricity Board
- Siam City Cement - Thailand
- Grasim Industreis Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Krishnapatnam Port Company Ltd. - India
- Romanian Commodities Exchange
- Gujarat Electricity Regulatory Commission - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- OPG Power Generation Pvt Ltd - India
- Electricity Generating Authority of Thailand
- IEA Clean Coal Centre - UK
- Anglo American - United Kingdom
- Kalimantan Lumbung Energi - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Sarangani Energy Corporation, Philippines
- Australian Commodity Traders Exchange
- Kepco SPC Power Corporation, Philippines
- Thai Mozambique Logistica
- Lanco Infratech Ltd - India
- Bulk Trading Sa - Switzerland
- Sakthi Sugars Limited - India
- Coastal Gujarat Power Limited - India
- South Luzon Thermal Energy Corporation
- Mercuria Energy - Indonesia
- Orica Mining Services - Indonesia
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- European Bulk Services B.V. - Netherlands
- Sree Jayajothi Cements Limited - India
- SN Aboitiz Power Inc, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhoruka Overseas - Indonesia
- Bharathi Cement Corporation - India
- Kideco Jaya Agung - Indonesia
- Tata Chemicals Ltd - India
- Ind-Barath Power Infra Limited - India
- Global Business Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Sojitz Corporation - Japan
- Energy Development Corp, Philippines
- Port Waratah Coal Services - Australia
- Gujarat Mineral Development Corp Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Semirara Mining and Power Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Barasentosa Lestari - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Straits Asia Resources Limited - Singapore
- New Zealand Coal & Carbon
- Uttam Galva Steels Limited - India
- Aboitiz Power Corporation - Philippines
- Indika Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Formosa Plastics Group - Taiwan
- Parliament of New Zealand
- Bangladesh Power Developement Board
- Medco Energi Mining Internasional
- Central Electricity Authority - India
- Larsen & Toubro Limited - India
- The University of Queensland
- Marubeni Corporation - India
- Metalloyd Limited - United Kingdom
- GAC Shipping (India) Pvt Ltd
- Interocean Group of Companies - India
- Central Java Power - Indonesia
- Miang Besar Coal Terminal - Indonesia
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