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Thursday, 13 June 13
BIMCO EXPECTS SUBDUED CAPESIZE EARNINGS FOR THE COMING WEEKS - HELLENIC SHIPPING NEWS
 Bulk is not only about China even though it is a key driver. In this section, we have taken a closer look at the European seaborne coal markets, which is going through some interesting times right now. European coal demand has been in a slump ever since early 2009, where seaborne demand fell by 14 million tons from the first to the second quarter. Import volumes during the last three quarters of 2011 indicated that seaborne coal demand was recovering, but the development stalled somewhat in 2012. Looking on a country basis, the nation with the biggest decline was Italy, with annual seaborne imports being roughly 8 million tons lower today than before the financial crisis. France has also decreased its imports by around 4-5 million tons annually. The United Kingdom and Spain have weakened as well, but these countries seem to be on a rebound, with volumes being slightly below pre-financial crisis levels. The Netherlands and Germany have had relatively stable import numbers since 2005.
The bulk of seaborne coal going to Europe comes from North America, Colombia and Russia. The United States and Colombia have doubled their exports to Europe, while Russia has maintained its share of the European demand. Russian coal is shipped from both Russian and Latvian ports; Colombian coal is primarily shipped from the Caribbean, while US coal is primarily shipped from the Atlantic Coast and the Mexican Gulf. The drop in European seaborne demand for coal did not affect these countries, but rather South Africa. From being the single largest coal exporter to Europe with 52.0 million tons in 2005, the country has become a footnote, with 13.6 million tons in 2011. This represents bad business for the shipping industry, since the sailing distance from Richards Bay to Rotterdam is 98% longer than from Hampton Roads and 61% longer than from Puerto Bolivar.
Although European coal imports didn’t tell a particular positive story for shipping, US exports most certainly did. We expect to publish a story on this within the next couple of weeks.
On a more general note regarding the bulk market, China is expected to increase its imports of wheat, as sub-standard storage facilities have damaged a part of the huge Chinese stockpiles. Traders said that China is seeking to increase imports when global prices are in a slump. Current forward prices indicate that this may happen during the third quarter of 2013. According to Chinese customs statistics, the main exporters of wheat to China are Australia, Canada and United States, the latter two providing significant tonne miles.
Meanwhile, Argentina is exporting record high volumes of grains; CRSL reported that Argentina exported 4.86 million tons of grains in March – the highest number ever for a single month. This gave a spike in Panamax rates with the BPI staying just below the psychological barrier of USD 10,000 per day in March and April, but earnings are now slightly lower at around USD 7,000 per day. In our last report, we predicted that Panamax rates would stay in the USD 5,000-10,000 per day territory; going forward seasonal events like Argentinian exports are likely to provide for the upside ticks.
SUPPLY
New dry bulk deliveries walk the anticipated line and have now reached 29 million DWT. Meanwhile, 11 million DWT have been sold for recycling, which brings the year-to-date fleet growth up to 2.8%. The inflow is seen primarily in the Panamax segment, where 136 (in 2012: 162) new vessels are keeping Panamax fleet growth high. Simultaneously, the Capesize segment only saw 48 (in 2012: 115) new vessels coming on stream, eventually easing some of the pain from the current overcapacity.
Average age and size of the demolished tonnage is 28 years and 60,000 DWT. In line with the development seen in the last couple of years, the average age is still trending down – whereas the average size is essentially unchanged. BIMCO forecasts a slightly lower level of tonnage being demolished in 2013 as compared to last year; however, it is still going to be the second-largest year on record. The solid level of demolition prices will inspire owners to consider recycling, rather than trading their old tonnage in a very volatile market without certainty of sustainable freight rates and against more energy efficient tonnage.
As regards the orderbook, it’s also moving in the right direction in spite of the recent flurry of new orders for more fuel-efficient tonnage. During the past 10 weeks the number of newbuilding orders in the book has come down from 1,599 to 1,548. Finally, on the ordering side, strong interest in Capesizes remains evident, with 62 new orders in 2013. A total of 18 million DWT has been ordered in the year so far, with March and April seeing total new orders placed in excess of 4.5 million DWT each month.
OUTLOOK
The Summer lull is creeping up on dry bulk shipping demand following the successful South American grain season. Fortunately, solid demand is keeping spirits up in the dry bulk industry, while the severe extent of overcapacity is pushing the date for a full-blown recovery of earnings into a somewhat distant future. For now the market is getting more and more spot focused, as no owners want to commit tonnage for longer terms at offered levels. Don’t look at the paper market for any support, because you won’t find it. FFA indications (10/6) for Capesize tonnage go to the tune of USD per day: Q3-13, Q4-13, Cal 14 and Cal 15: 7,550, 12,000, 11,450 and 13,700 and for Supramax the indications go as follows in USD per day for the same dates: 7,900, 8,400, 8,600 and 8,900. USD per day in the spot market (10/6): Capesize for 5,571 and Supramax for 9,307.
Expect the unexpected from the dry bulk market seems to be the message passed on in recent years – and today is no different, as Handysize tonnage is earning USD 10,900 per day on an Atlantic round voyage whereas Capesizes are struggling to get a 1 year T/C fixed at USD 10,500 per day if at all. With respect to freight rates for Panamax and Supramax tonnage, they have lost ground since the beginning of March.
To sum up, our forecast for the coming 6 weeks: BIMCO holds the view that Capesize TC average rates are expected to remain subdued around USD 4,500-7,500 per day. Panamax is expected to stay in the USD 4,500-8,000 per day interval. For the Supramax segment, BIMCO forecasts freight rates in the USD 7,000-10,000 per day interval, whereas Handysize rates are forecast to stay at the interval of USD 6,000-8,500 per day.
Source: BIMCO / Hellenic Shipping News
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Thursday, 18 July 13
DRY BULK MARKETS RETAINS RECENT GAINS, MOVES SIDEWAYS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has kept on moving sideways this week, as evidenced by the latest trends of the industry's benchmark, the Baltic Dry Index (BDI ...
Wednesday, 17 July 13
NEWCASTLE COAL EXPORTS FELL 3.85% ON WEEK
COALspot.com: Newcastle port in Australia has loaded 2,860,149 tons of coal for the week ended 0700 hours 15 July 2013, Newcastle Port Corp. s ...
Wednesday, 17 July 13
TORN BETWEEN A CREDIT CRUNCH AND SUSTAINABLE GROWTH - GEORGE DERMATIS
COALspot.com: In 2012 China expanded at a rate of 7.8%, its worst annual performance in 13 years, raising criticism over the newly appointed governm ...
Tuesday, 16 July 13
TAKE - OR - PAY CONTRACTS CONTINUE TO INCENTIVISE AUSTRALIAN COAL PRODUCERS DESPITE POTENTIAL NEGATIVE CASH MARGINS - WOOD MACKENZIE
Australia's coal production has continued to grow, despite lower coal prices in 2013. Global investors and suppliers are therefore questioning whet ...
Monday, 15 July 13
INDONESIAN GOVERNMENT HAS REVISED DOWN ITS JULY BENCH-MARK COAL PRICE TO US$ 81.69 PER MT
COALspot. com - Indonesian Coal Price Reference dropped 3.75 % and hitting a 2013 low. The Indonesian government has revised down its owned coal ben ...
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- India Bulls Power Limited - India
- Ambuja Cements Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Orica Australia Pty. Ltd.
- Independent Power Producers Association of India
- Pendopo Energi Batubara - Indonesia
- Rio Tinto Coal - Australia
- The State Trading Corporation of India Ltd
- Gujarat Electricity Regulatory Commission - India
- Jindal Steel & Power Ltd - India
- Jaiprakash Power Ventures ltd
- Bahari Cakrawala Sebuku - Indonesia
- Wilmar Investment Holdings
- Global Coal Blending Company Limited - Australia
- Salva Resources Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Africa Commodities Group - South Africa
- Chettinad Cement Corporation Ltd - India
- The Treasury - Australian Government
- Kepco SPC Power Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Sarangani Energy Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Power Finance Corporation Ltd., India
- PetroVietnam Power Coal Import and Supply Company
- Carbofer General Trading SA - India
- Aboitiz Power Corporation - Philippines
- Holcim Trading Pte Ltd - Singapore
- Makarim & Taira - Indonesia
- Tamil Nadu electricity Board
- Gujarat Sidhee Cement - India
- Intertek Mineral Services - Indonesia
- Riau Bara Harum - Indonesia
- TeaM Sual Corporation - Philippines
- Mjunction Services Limited - India
- Bulk Trading Sa - Switzerland
- CNBM International Corporation - China
- Interocean Group of Companies - India
- Mercator Lines Limited - India
- Kapuas Tunggal Persada - Indonesia
- Sical Logistics Limited - India
- Binh Thuan Hamico - Vietnam
- Ceylon Electricity Board - Sri Lanka
- Mercuria Energy - Indonesia
- Indika Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Electricity Authority, New Zealand
- Vedanta Resources Plc - India
- Parliament of New Zealand
- Uttam Galva Steels Limited - India
- AsiaOL BioFuels Corp., Philippines
- South Luzon Thermal Energy Corporation
- ASAPP Information Group - India
- Gujarat Mineral Development Corp Ltd - India
- Kartika Selabumi Mining - Indonesia
- Coal and Oil Company - UAE
- Energy Link Ltd, New Zealand
- SMG Consultants - Indonesia
- IEA Clean Coal Centre - UK
- Directorate Of Revenue Intelligence - India
- Barasentosa Lestari - Indonesia
- Larsen & Toubro Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- McConnell Dowell - Australia
- Jorong Barutama Greston.PT - Indonesia
- Bharathi Cement Corporation - India
- Sree Jayajothi Cements Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Energy Development Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- Global Business Power Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Bayan Resources Tbk. - Indonesia
- VISA Power Limited - India
- MS Steel International - UAE
- Electricity Generating Authority of Thailand
- LBH Netherlands Bv - Netherlands
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Latin American Coal - Colombia
- Sindya Power Generating Company Private Ltd
- Videocon Industries ltd - India
- GVK Power & Infra Limited - India
- Deloitte Consulting - India
- New Zealand Coal & Carbon
- Minerals Council of Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Georgia Ports Authority, United States
- Dalmia Cement Bharat India
- Economic Council, Georgia
- Baramulti Group, Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Siam City Cement PLC, Thailand
- Coalindo Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- GAC Shipping (India) Pvt Ltd
- Coastal Gujarat Power Limited - India
- Edison Trading Spa - Italy
- Kaltim Prima Coal - Indonesia
- CIMB Investment Bank - Malaysia
- Tata Chemicals Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Merrill Lynch Commodities Europe
- Karaikal Port Pvt Ltd - India
- Sojitz Corporation - Japan
- Therma Luzon, Inc, Philippines
- Mintek Dendrill Indonesia
- Orica Mining Services - Indonesia
- Madhucon Powers Ltd - India
- Bangladesh Power Developement Board
- Kohat Cement Company Ltd. - Pakistan
- Posco Energy - South Korea
- Marubeni Corporation - India
- OPG Power Generation Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Australian Commodity Traders Exchange
- Price Waterhouse Coopers - Russia
- Parry Sugars Refinery, India
- Medco Energi Mining Internasional
- Planning Commission, India
- Attock Cement Pakistan Limited
- Vizag Seaport Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Cement Manufacturers Association - India
- Iligan Light & Power Inc, Philippines
- Trasteel International SA, Italy
- Aditya Birla Group - India
- GN Power Mariveles Coal Plant, Philippines
- Central Java Power - Indonesia
- Samtan Co., Ltd - South Korea
- Ministry of Transport, Egypt
- Xindia Steels Limited - India
- Ministry of Mines - Canada
- Globalindo Alam Lestari - Indonesia
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- Port Waratah Coal Services - Australia
- Savvy Resources Ltd - HongKong
- Agrawal Coal Company - India
- Semirara Mining and Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Petron Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- SMC Global Power, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Rashtriya Ispat Nigam Limited - India
- Heidelberg Cement - Germany
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- Thai Mozambique Logistica
- Standard Chartered Bank - UAE
- Lanco Infratech Ltd - India
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- International Coal Ventures Pvt Ltd - India
- Grasim Industreis Ltd - India
- Indonesian Coal Mining Association
- PowerSource Philippines DevCo
- Indogreen Group - Indonesia
- Sakthi Sugars Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Indian Oil Corporation Limited
- Alfred C Toepfer International GmbH - Germany
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Central Electricity Authority - India
- Bhoruka Overseas - Indonesia
- Straits Asia Resources Limited - Singapore
- Commonwealth Bank - Australia
- Goldman Sachs - Singapore
- Anglo American - United Kingdom
- Ministry of Finance - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Global Green Power PLC Corporation, Philippines
- Thiess Contractors Indonesia
- White Energy Company Limited
- San Jose City I Power Corp, Philippines
- European Bulk Services B.V. - Netherlands
- Singapore Mercantile Exchange
- Timah Investasi Mineral - Indoneisa
- Wood Mackenzie - Singapore
- Indian Energy Exchange, India
- Kumho Petrochemical, South Korea
- Romanian Commodities Exchange
- PTC India Limited - India
- Eastern Energy - Thailand
- Chamber of Mines of South Africa
- Miang Besar Coal Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- Indo Tambangraya Megah - Indonesia
- Meenaskhi Energy Private Limited - India
- The University of Queensland
- Bukit Baiduri Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Eastern Coal Council - USA
- Meralco Power Generation, Philippines
- PNOC Exploration Corporation - Philippines
- Renaissance Capital - South Africa
- Oldendorff Carriers - Singapore
- Bhatia International Limited - India
- GMR Energy Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Australian Coal Association
- Toyota Tsusho Corporation, Japan
- Karbindo Abesyapradhi - Indoneisa
- ICICI Bank Limited - India
- Cigading International Bulk Terminal - Indonesia
- Bhushan Steel Limited - India
- Simpson Spence & Young - Indonesia
- Star Paper Mills Limited - India
- London Commodity Brokers - England
- Sinarmas Energy and Mining - Indonesia
- Borneo Indobara - Indonesia
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