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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, 08 December 11
HAREDA KRIDA GETS CONTRACT FROM BAYAN - INSIDER STORIES
Insider Stories reported that, coal miner PT Bayan Resources Tbk (BYAN), through its subsidiary dubbed PT Gunungbayan Pratamacoal (GPB), has signed ...
Thursday, 08 December 11
CAPESIZES LIFT DRY BULK MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Capesize vessels yesterday helped lift the dry bulk market which had been falling since the start of the week on lower cargo demand. As a result the ...
Wednesday, 07 December 11
ABM INVESTAMA EYES RP6.3 TRIO REVENUE - INSIDER STORIES
Insider Stories reported that, an energy integrated company PT ABM Investama Tbk is eyeing a 1.5 folds increase in revenue this year from Rp4. ...
Tuesday, 06 December 11
DRY BULK MARKET ENDS RALLY, STARTS WEEK WITH FALL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
After a series of increases which saw the dry bulk market’s benchmark, the Baltic Dry Index (BDI) increasing close to 1,900 points and rates o ...
Monday, 05 December 11
THE DECEMBER HBA FELL 11% FROM ITS PEAK AT US$127.05 PER TON IN FEBRUARY 2011
COALspot.com - Ministry of Energy and Mineral Resources of Indonesia has sets the December 2011 coal reference price at US$ 112.67 per ton US$ 3.98 ...
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- Port Waratah Coal Services - Australia
- Jindal Steel & Power Ltd - India
- Central Electricity Authority - India
- Kumho Petrochemical, South Korea
- Indogreen Group - Indonesia
- OPG Power Generation Pvt Ltd - India
- Larsen & Toubro Limited - India
- Mercator Lines Limited - India
- Power Finance Corporation Ltd., India
- Posco Energy - South Korea
- Bayan Resources Tbk. - Indonesia
- Independent Power Producers Association of India
- GMR Energy Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Bukit Baiduri Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Heidelberg Cement - Germany
- Semirara Mining and Power Corporation, Philippines
- White Energy Company Limited
- Jaiprakash Power Ventures ltd
- Tamil Nadu electricity Board
- Thai Mozambique Logistica
- Holcim Trading Pte Ltd - Singapore
- Makarim & Taira - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Star Paper Mills Limited - India
- Ministry of Mines - Canada
- Coal and Oil Company - UAE
- Romanian Commodities Exchange
- Tata Chemicals Ltd - India
- Energy Link Ltd, New Zealand
- Iligan Light & Power Inc, Philippines
- Mintek Dendrill Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Pipit Mutiara Jaya. PT, Indonesia
- Bhoruka Overseas - Indonesia
- Riau Bara Harum - Indonesia
- Eastern Energy - Thailand
- Singapore Mercantile Exchange
- Krishnapatnam Port Company Ltd. - India
- Meralco Power Generation, Philippines
- Ministry of Finance - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indika Energy - Indonesia
- Mercuria Energy - Indonesia
- Electricity Authority, New Zealand
- Aditya Birla Group - India
- Vedanta Resources Plc - India
- Madhucon Powers Ltd - India
- PNOC Exploration Corporation - Philippines
- Antam Resourcindo - Indonesia
- Anglo American - United Kingdom
- Coalindo Energy - Indonesia
- Standard Chartered Bank - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Salva Resources Pvt Ltd - India
- Marubeni Corporation - India
- PowerSource Philippines DevCo
- Africa Commodities Group - South Africa
- Maheswari Brothers Coal Limited - India
- Sical Logistics Limited - India
- Australian Commodity Traders Exchange
- Edison Trading Spa - Italy
- Cement Manufacturers Association - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Price Waterhouse Coopers - Russia
- Wood Mackenzie - Singapore
- India Bulls Power Limited - India
- IHS Mccloskey Coal Group - USA
- Pendopo Energi Batubara - Indonesia
- Toyota Tsusho Corporation, Japan
- Sojitz Corporation - Japan
- SN Aboitiz Power Inc, Philippines
- Renaissance Capital - South Africa
- Carbofer General Trading SA - India
- Neyveli Lignite Corporation Ltd, - India
- Bukit Makmur.PT - Indonesia
- Essar Steel Hazira Ltd - India
- New Zealand Coal & Carbon
- Siam City Cement PLC, Thailand
- Medco Energi Mining Internasional
- Bank of Tokyo Mitsubishi UFJ Ltd
- TeaM Sual Corporation - Philippines
- Grasim Industreis Ltd - India
- South Luzon Thermal Energy Corporation
- Minerals Council of Australia
- Central Java Power - Indonesia
- Georgia Ports Authority, United States
- Sree Jayajothi Cements Limited - India
- VISA Power Limited - India
- Uttam Galva Steels Limited - India
- Semirara Mining Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Orica Australia Pty. Ltd.
- Economic Council, Georgia
- Coastal Gujarat Power Limited - India
- Wilmar Investment Holdings
- European Bulk Services B.V. - Netherlands
- Simpson Spence & Young - Indonesia
- Global Coal Blending Company Limited - Australia
- Leighton Contractors Pty Ltd - Australia
- Borneo Indobara - Indonesia
- Indian Energy Exchange, India
- GVK Power & Infra Limited - India
- Thiess Contractors Indonesia
- Alfred C Toepfer International GmbH - Germany
- Karbindo Abesyapradhi - Indoneisa
- Formosa Plastics Group - Taiwan
- Ministry of Transport, Egypt
- Kobexindo Tractors - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- LBH Netherlands Bv - Netherlands
- Ceylon Electricity Board - Sri Lanka
- IEA Clean Coal Centre - UK
- Billiton Holdings Pty Ltd - Australia
- Therma Luzon, Inc, Philippines
- Savvy Resources Ltd - HongKong
- Bhushan Steel Limited - India
- Petron Corporation, Philippines
- SMG Consultants - Indonesia
- Eastern Coal Council - USA
- San Jose City I Power Corp, Philippines
- Indonesian Coal Mining Association
- Altura Mining Limited, Indonesia
- Baramulti Group, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kapuas Tunggal Persada - Indonesia
- Lanco Infratech Ltd - India
- Rashtriya Ispat Nigam Limited - India
- ASAPP Information Group - India
- Kartika Selabumi Mining - Indonesia
- Barasentosa Lestari - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- SMC Global Power, Philippines
- GAC Shipping (India) Pvt Ltd
- Sakthi Sugars Limited - India
- Directorate Of Revenue Intelligence - India
- PTC India Limited - India
- Manunggal Multi Energi - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- Timah Investasi Mineral - Indoneisa
- Latin American Coal - Colombia
- Chamber of Mines of South Africa
- Indo Tambangraya Megah - Indonesia
- Ind-Barath Power Infra Limited - India
- Vizag Seaport Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Energy Development Corp, Philippines
- Agrawal Coal Company - India
- Dalmia Cement Bharat India
- Ambuja Cements Ltd - India
- Indian Oil Corporation Limited
- Bulk Trading Sa - Switzerland
- Electricity Generating Authority of Thailand
- Parliament of New Zealand
- Kalimantan Lumbung Energi - Indonesia
- The Treasury - Australian Government
- Sarangani Energy Corporation, Philippines
- The University of Queensland
- Goldman Sachs - Singapore
- Kaltim Prima Coal - Indonesia
- Commonwealth Bank - Australia
- MS Steel International - UAE
- Gujarat Mineral Development Corp Ltd - India
- Rio Tinto Coal - Australia
- CIMB Investment Bank - Malaysia
- Kohat Cement Company Ltd. - Pakistan
- Bhatia International Limited - India
- Jorong Barutama Greston.PT - Indonesia
- CNBM International Corporation - China
- Videocon Industries ltd - India
- Kepco SPC Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- Aboitiz Power Corporation - Philippines
- Trasteel International SA, Italy
- London Commodity Brokers - England
- Mjunction Services Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- ICICI Bank Limited - India
- Attock Cement Pakistan Limited
- Malabar Cements Ltd - India
- AsiaOL BioFuels Corp., Philippines
- McConnell Dowell - Australia
- Planning Commission, India
- Petrochimia International Co. Ltd.- Taiwan
- Bangladesh Power Developement Board
- Intertek Mineral Services - Indonesia
- Interocean Group of Companies - India
- TNB Fuel Sdn Bhd - Malaysia
- Samtan Co., Ltd - South Korea
- International Coal Ventures Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Chettinad Cement Corporation Ltd - India
- Orica Mining Services - Indonesia
- Sindya Power Generating Company Private Ltd
- Parry Sugars Refinery, India
- Australian Coal Association
- Bharathi Cement Corporation - India
- The State Trading Corporation of India Ltd
- Oldendorff Carriers - Singapore
- Deloitte Consulting - India
- Binh Thuan Hamico - Vietnam
- Global Business Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Xindia Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Siam City Cement - Thailand
- Asmin Koalindo Tuhup - Indonesia
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