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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, 10 January 12
THE 4TH DEEPWATER ASIA CONGRESS 2012 WILL KICK OFF ON MAY 23 - 25
Press release - Based on the past three years’ success, SZ & W Group is excited to announce the 4th Deepwater Asia Congress will be held o ...
Monday, 09 January 12
2012: WHAT WILL IT BRING FOR THE DRY BULK MARKET? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A further increase in dry bulk demand could be the remedy for most of the industry's oversupply issues, together of course with the high level of s ...
Sunday, 08 January 12
ICICI OUTLOOK ON INDIAN POWER, MINING,CEMENT, AND SHIPPING SECTORS PERFORMANCE IN 2012
Broking firm, ICICIdirect (India) has come out with report on sectors outlook for 2012. IRIS has collated key highlights for each sector from ...
Sunday, 08 January 12
SUPRAMAX DELIVERY SOUTH CHINA FOR TRIPS VIA INDONESIA WERE REPORTED AROUND $ 7000 PER DAY - VISTAAR
Wish You a Very Happy and Prosperous New year 2012.
COALspot.com - The last report by us was on 16th Dec 2011 and because of holidays this would ...
Sunday, 08 January 12
THARPAK CONSORTIUM FORMED TO DEVELOP MEGA ENERGY COMPLEX IN SINDH PROVINCE, PAKISTAN
Press Release: On January 5th, TharPak, LLC met with officials of the Embassy of Pakistan in Washington DC to introduce and announce the formation o ...
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- Sical Logistics Limited - India
- Indonesian Coal Mining Association
- Bukit Baiduri Energy - Indonesia
- London Commodity Brokers - England
- Electricity Generating Authority of Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Baramulti Group, Indonesia
- Wilmar Investment Holdings
- Indian Energy Exchange, India
- Price Waterhouse Coopers - Russia
- Globalindo Alam Lestari - Indonesia
- Orica Australia Pty. Ltd.
- Alfred C Toepfer International GmbH - Germany
- Altura Mining Limited, Indonesia
- GMR Energy Limited - India
- IEA Clean Coal Centre - UK
- MS Steel International - UAE
- Siam City Cement PLC, Thailand
- Cigading International Bulk Terminal - Indonesia
- Jaiprakash Power Ventures ltd
- Meralco Power Generation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Petron Corporation, Philippines
- GVK Power & Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Bank of Tokyo Mitsubishi UFJ Ltd
- TNB Fuel Sdn Bhd - Malaysia
- South Luzon Thermal Energy Corporation
- Billiton Holdings Pty Ltd - Australia
- Bayan Resources Tbk. - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ASAPP Information Group - India
- Kumho Petrochemical, South Korea
- Simpson Spence & Young - Indonesia
- Makarim & Taira - Indonesia
- Grasim Industreis Ltd - India
- Coal and Oil Company - UAE
- Wood Mackenzie - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PowerSource Philippines DevCo
- Savvy Resources Ltd - HongKong
- Aditya Birla Group - India
- Global Business Power Corporation, Philippines
- Central Electricity Authority - India
- Ind-Barath Power Infra Limited - India
- Chettinad Cement Corporation Ltd - India
- White Energy Company Limited
- Rashtriya Ispat Nigam Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Minerals Council of Australia
- Sree Jayajothi Cements Limited - India
- Karaikal Port Pvt Ltd - India
- Indian Oil Corporation Limited
- Commonwealth Bank - Australia
- The University of Queensland
- Antam Resourcindo - Indonesia
- GAC Shipping (India) Pvt Ltd
- Energy Link Ltd, New Zealand
- The State Trading Corporation of India Ltd
- Bangladesh Power Developement Board
- Straits Asia Resources Limited - Singapore
- Anglo American - United Kingdom
- International Coal Ventures Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Orica Mining Services - Indonesia
- Coastal Gujarat Power Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Carbofer General Trading SA - India
- SN Aboitiz Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Samtan Co., Ltd - South Korea
- Bhushan Steel Limited - India
- Siam City Cement - Thailand
- VISA Power Limited - India
- TeaM Sual Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Thiess Contractors Indonesia
- Indo Tambangraya Megah - Indonesia
- Parliament of New Zealand
- Energy Development Corp, Philippines
- Ministry of Finance - Indonesia
- Jindal Steel & Power Ltd - India
- Vizag Seaport Private Limited - India
- European Bulk Services B.V. - Netherlands
- Ceylon Electricity Board - Sri Lanka
- Binh Thuan Hamico - Vietnam
- Singapore Mercantile Exchange
- Tata Chemicals Ltd - India
- Africa Commodities Group - South Africa
- Agrawal Coal Company - India
- Mintek Dendrill Indonesia
- Renaissance Capital - South Africa
- Videocon Industries ltd - India
- Deloitte Consulting - India
- Power Finance Corporation Ltd., India
- The Treasury - Australian Government
- Pendopo Energi Batubara - Indonesia
- Salva Resources Pvt Ltd - India
- Independent Power Producers Association of India
- Xindia Steels Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Rio Tinto Coal - Australia
- Tamil Nadu electricity Board
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Mineral Development Corp Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Bukit Makmur.PT - Indonesia
- SMC Global Power, Philippines
- Borneo Indobara - Indonesia
- Mercator Lines Limited - India
- Bhatia International Limited - India
- Mercuria Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Economic Council, Georgia
- Asmin Koalindo Tuhup - Indonesia
- PNOC Exploration Corporation - Philippines
- Planning Commission, India
- Gujarat Electricity Regulatory Commission - India
- Port Waratah Coal Services - Australia
- Indogreen Group - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Trasteel International SA, Italy
- Bharathi Cement Corporation - India
- Banpu Public Company Limited - Thailand
- Kartika Selabumi Mining - Indonesia
- Larsen & Toubro Limited - India
- Formosa Plastics Group - Taiwan
- Vedanta Resources Plc - India
- Semirara Mining and Power Corporation, Philippines
- Cement Manufacturers Association - India
- Maheswari Brothers Coal Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Kepco SPC Power Corporation, Philippines
- Medco Energi Mining Internasional
- Lanco Infratech Ltd - India
- Aboitiz Power Corporation - Philippines
- SMG Consultants - Indonesia
- Latin American Coal - Colombia
- Ministry of Transport, Egypt
- Attock Cement Pakistan Limited
- Karbindo Abesyapradhi - Indoneisa
- Posco Energy - South Korea
- Romanian Commodities Exchange
- IHS Mccloskey Coal Group - USA
- Metalloyd Limited - United Kingdom
- Coalindo Energy - Indonesia
- Semirara Mining Corp, Philippines
- McConnell Dowell - Australia
- Sindya Power Generating Company Private Ltd
- Therma Luzon, Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- ICICI Bank Limited - India
- Riau Bara Harum - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Bhoruka Overseas - Indonesia
- Kobexindo Tractors - Indoneisa
- Goldman Sachs - Singapore
- Sojitz Corporation - Japan
- Barasentosa Lestari - Indonesia
- Central Java Power - Indonesia
- Kaltim Prima Coal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Sidhee Cement - India
- Intertek Mineral Services - Indonesia
- Ambuja Cements Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Directorate Of Revenue Intelligence - India
- Global Coal Blending Company Limited - Australia
- Manunggal Multi Energi - Indonesia
- Australian Commodity Traders Exchange
- PTC India Limited - India
- Parry Sugars Refinery, India
- Uttam Galva Steels Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Timah Investasi Mineral - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Eastern Coal Council - USA
- Interocean Group of Companies - India
- Mjunction Services Limited - India
- Electricity Authority, New Zealand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Standard Chartered Bank - UAE
- Oldendorff Carriers - Singapore
- Edison Trading Spa - Italy
- Sakthi Sugars Limited - India
- Thai Mozambique Logistica
- Eastern Energy - Thailand
- Heidelberg Cement - Germany
- Australian Coal Association
- Bukit Asam (Persero) Tbk - Indonesia
- Georgia Ports Authority, United States
- CIMB Investment Bank - Malaysia
- LBH Netherlands Bv - Netherlands
- Essar Steel Hazira Ltd - India
- CNBM International Corporation - China
- Malabar Cements Ltd - India
- Iligan Light & Power Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Indika Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Merrill Lynch Commodities Europe
- Marubeni Corporation - India
- Madhucon Powers Ltd - India
- New Zealand Coal & Carbon
- Pipit Mutiara Jaya. PT, Indonesia
- Star Paper Mills Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Toyota Tsusho Corporation, Japan
- India Bulls Power Limited - India
- Ministry of Mines - Canada
- Chamber of Mines of South Africa
- Bahari Cakrawala Sebuku - Indonesia
- Dalmia Cement Bharat India
- Sarangani Energy Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
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