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Wednesday, 07 August 13
HANDIES : FINDING IT DIFFICULT TO SUSTAIN THEIR PREVIOUS LEVELS - KONSTANTINOS KONTOMICHIS
 Broker's insight
by Konstantinos Kontomichis,
SnP Broker
Entering the most predictable month of the year, as expected the seasonal effects has pushed sentiment back into negative territory. As the Greek owners are enjoying their summer time off, the S&P market is falling apart. While few prospective buyers have stayed back in their office to grab any chances and possibly avoid competition while doing so, most seem to have postponed their interest till September in the hope of seeing a market that they feel will make more sense. One can say that the recent price inflation posted over the last two quarters in the Dry Bulk market and more specifically for panamax vessels, is an additional reason for some to switch over to a “wait & see” attitude at least until the slowest month (in terms of chartering) has past.
From the beginning of 2013, handy tonnages have faced the smallest fluctuations in values, reflecting the fact that they still the vessels holding the lowest risk exposure in the dry market. Supramax asset values were running on the high end, something which is quite reasonable though considering the fact that this size segment has been enjoying the best returns in the market over the last couple of years. On the other hand the poor rates, overwhelming delivery schedule and overall negative sentiment for Panamaxes during the second half of the previous year caused depressed sales in the sector. The cheapest deals took place, during the end of 2012 and the very beginning of 2013, providing the groundwork and sparking heavy competition amongst Greek cash buyers which resulted in the unexpected climb in prices.
The recent rally in asset prices which we witnessed was also driven by the appearance of funds and private-equity covering the gap left from the more cautious and now heavily regulated banks. Many were claiming “we are scratching the bottom” and their words translated to private investors as “rock bottom bargain prices”. Of course along the way several additional economic factors played their part in the underling reasoning. The bankruptcy of the Cypriot banking system, the instability of Greek financial institutions and the clouded economic policy of the European Union was enough to push investors to the “sea” as a much “safer” choice.
In all these “safer” decisions there seems to be little room for “profitable”. The above decisions are locked at the going charter rates. It does not make any sense at these levels as the actual earnings do not reflect the levels that ship prices have reached. It is no surprise that we have not only reached back to pre-boom long-term repayment periods for bank loans and even surpassing them. Owners are struggling, shipping is still looking like part of a falling domino structure while many fundamentals are still missing from the market such as financing, economic stability, strong world economic growth, slower supply growth etc. Waiting for a market comeback we have to remember there is always a 'Dummy variable”. No one can predict the future, and despite everything seeming “bearish”, there is no telling of the potential direction the market could end up taking.
Chartering (Wet: Stable- / Dry: Stable- )
With the exception of the Capes, the whole of the Dry Bulk market witnessed a further correction in rates on the face of slower activity in the Atlantic and poor positioning overall. The summer blues have continue to overwhelm market players and things are looking set for further decreases over the next couple of days. The BDI closed today (06/08/2013) at 1046points, down by 12 points compared to Monday’s levels (05/08/2013) and a decrease of 21 points compared to previous Tuesday’s levels (29/07/2013).
The crude oil market noted some correction, however overall demand has held fairly well especially when one considers that this is traditionally the slowest part of the year. Demand for Crude oil from the U.S. has now drop, leaving the market ripe for a drop though you never know in this sort of market. The BDTI Monday (05/08/2013), was at 618 points, a decrease of 32 points and the BCTI at 612, an increase of 5 points compared to the previous Monday’s levels (28/07/2013).
Chartering
There was a hold in the rates drop for Capes, with the Atlantic basin showing some improved demand and fending off any further weakening for now. The Pacific was the real market support this week, helping cover much of the slack in demand left by a softer Atlantic and allowing for some temporary relief. With activity likely to drop further over the next couple of weeks especial for iron ore cargoes, August is likely to be a fairly poor performance overall and this current levels are unlikely to hold for long.
Continuing on from the week prior, Panamaxes lost further support this past week as the Atlantic drop further on the face of fewer inquiries coming in from ECSA. The Pacific on the other hand is in no state to cover the gap in demand and is likely going to feel further weakening itself. This overall slower activity has taken its toll on sentiment and it is likely that we will see the index close of this coming Friday well below the 1,000 point mark.
This slower activity in the Atlantic took its toll on Supras as well this week, as it now becomes more evident to what degree the demand from ECSA was holding the market buoyant these past weeks. There was some gains to be noted on other Atlantic basin routes such as Continent/US Gulf, however these were to insignificant to effect the overall picture. Handies were also finding it difficult to sustain their previous levels and have also seen a slight overall drop these past few days. The Pacific basin wasn’t looking very charming either with decreased demand for raw resources from China these past weeks and India still remaining fairly subdued, it looks as though it will be another gloomy August as usual.
Compiled by:
Intermodal Research & Valuations | research@intermodal.gr
Analysts:
Mr. George Lazaridis | g.lazaridis@intermodal.gr
Ms. Eva Tzima | e.tzima@intermodal.gr
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no re-producing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
Information contained within the website of COALspot.com is intended for informational purposes only and is not intended as professional counsel and should not be used as such.
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Thursday, 22 August 13
PANAMAX : PERIOD MARKET IS STILL BEING LED BY STRONGER SENTIMENT IN THE FFA'S - FEARNRESEARCH
Handy
This week started slowly as expected. Indo biz now rate APS around 7k +60k to china and around 8k+80k to India. However, there are some ships ...
Wednesday, 21 August 13
DRY BULK SHIPPING - POSITIVE WINDOW FOR CAPESIZE OWNERS - PETER SAND
By: Peter Sand, Chief Shipping Analyst, BIMCO
Demand:
“Expect the unexpected from the dry bulk market” was what we wrote last time ar ...
Wednesday, 21 August 13
RATES FOR CAPES MOVED DECISIVELY NORTH THIS WEEK - INTERMODAL
COALspot.com - Right when the BDI seemed ready for another dive below the 1000 points level, the Dry Bulk market made significant comeback this week ...
Tuesday, 20 August 13
AUSTRALIA NEWCASTLE COAL EXPORTS FALL 19.15 PERCENT ON WEEK
COALspot.com: Power plant and semi-soft coking coal shipments from Australia's Newcastle port fell 19.15 per cent week on week to 2.39 million mt f ...
Tuesday, 20 August 13
CAPESIZE RATES MORE SENSITIVE TO DEMAND - COMMODORE RESEARCH & CONSULTANCY
COALspot.com : Approximately 71.50 million tons of iron ore is now stockpiled at Chinese ports, 900,000 tons (-1%) less than a week ago, Commodore R ...
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- Meenaskhi Energy Private Limited - India
- Kartika Selabumi Mining - Indonesia
- Electricity Authority, New Zealand
- Karbindo Abesyapradhi - Indoneisa
- Kobexindo Tractors - Indoneisa
- Manunggal Multi Energi - Indonesia
- Karaikal Port Pvt Ltd - India
- Renaissance Capital - South Africa
- Electricity Generating Authority of Thailand
- Borneo Indobara - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- IHS Mccloskey Coal Group - USA
- Kohat Cement Company Ltd. - Pakistan
- Indogreen Group - Indonesia
- Energy Link Ltd, New Zealand
- Singapore Mercantile Exchange
- Grasim Industreis Ltd - India
- Mintek Dendrill Indonesia
- London Commodity Brokers - England
- Edison Trading Spa - Italy
- Indonesian Coal Mining Association
- Ministry of Transport, Egypt
- Bukit Makmur.PT - Indonesia
- Intertek Mineral Services - Indonesia
- Vedanta Resources Plc - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Medco Energi Mining Internasional
- Standard Chartered Bank - UAE
- Asmin Koalindo Tuhup - Indonesia
- Thiess Contractors Indonesia
- Sakthi Sugars Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Petron Corporation, Philippines
- Port Waratah Coal Services - Australia
- Anglo American - United Kingdom
- Xindia Steels Limited - India
- Siam City Cement - Thailand
- Kaltim Prima Coal - Indonesia
- Kideco Jaya Agung - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Leighton Contractors Pty Ltd - Australia
- Wilmar Investment Holdings
- Sindya Power Generating Company Private Ltd
- AsiaOL BioFuels Corp., Philippines
- Barasentosa Lestari - Indonesia
- Sojitz Corporation - Japan
- TNB Fuel Sdn Bhd - Malaysia
- Cigading International Bulk Terminal - Indonesia
- Orica Mining Services - Indonesia
- Iligan Light & Power Inc, Philippines
- Mjunction Services Limited - India
- Metalloyd Limited - United Kingdom
- McConnell Dowell - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Posco Energy - South Korea
- Independent Power Producers Association of India
- Directorate Of Revenue Intelligence - India
- Deloitte Consulting - India
- Savvy Resources Ltd - HongKong
- Petrochimia International Co. Ltd.- Taiwan
- Pendopo Energi Batubara - Indonesia
- VISA Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- Billiton Holdings Pty Ltd - Australia
- Tamil Nadu electricity Board
- LBH Netherlands Bv - Netherlands
- Cement Manufacturers Association - India
- Globalindo Alam Lestari - Indonesia
- Timah Investasi Mineral - Indoneisa
- Dalmia Cement Bharat India
- Salva Resources Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- SN Aboitiz Power Inc, Philippines
- Coal and Oil Company - UAE
- GMR Energy Limited - India
- Therma Luzon, Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- San Jose City I Power Corp, Philippines
- Economic Council, Georgia
- OPG Power Generation Pvt Ltd - India
- Australian Commodity Traders Exchange
- Gujarat Mineral Development Corp Ltd - India
- CIMB Investment Bank - Malaysia
- Jorong Barutama Greston.PT - Indonesia
- Indian Oil Corporation Limited
- Bhatia International Limited - India
- Marubeni Corporation - India
- Jaiprakash Power Ventures ltd
- Bhushan Steel Limited - India
- Price Waterhouse Coopers - Russia
- Commonwealth Bank - Australia
- GN Power Mariveles Coal Plant, Philippines
- Larsen & Toubro Limited - India
- Wood Mackenzie - Singapore
- Aditya Birla Group - India
- Carbofer General Trading SA - India
- Jindal Steel & Power Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- MS Steel International - UAE
- Makarim & Taira - Indonesia
- Semirara Mining Corp, Philippines
- Planning Commission, India
- Central Electricity Authority - India
- Holcim Trading Pte Ltd - Singapore
- Romanian Commodities Exchange
- Agrawal Coal Company - India
- Gujarat Electricity Regulatory Commission - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Georgia Ports Authority, United States
- Bhoruka Overseas - Indonesia
- Uttam Galva Steels Limited - India
- Central Java Power - Indonesia
- International Coal Ventures Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Maheswari Brothers Coal Limited - India
- PTC India Limited - India
- Interocean Group of Companies - India
- Africa Commodities Group - South Africa
- European Bulk Services B.V. - Netherlands
- Simpson Spence & Young - Indonesia
- Rio Tinto Coal - Australia
- Essar Steel Hazira Ltd - India
- Thai Mozambique Logistica
- Bahari Cakrawala Sebuku - Indonesia
- Parry Sugars Refinery, India
- Vizag Seaport Private Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Mercator Lines Limited - India
- Gujarat Sidhee Cement - India
- Sree Jayajothi Cements Limited - India
- Sical Logistics Limited - India
- Sarangani Energy Corporation, Philippines
- Ministry of Finance - Indonesia
- ASAPP Information Group - India
- Alfred C Toepfer International GmbH - Germany
- Indika Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Bayan Resources Tbk. - Indonesia
- Ind-Barath Power Infra Limited - India
- New Zealand Coal & Carbon
- Meralco Power Generation, Philippines
- Global Coal Blending Company Limited - Australia
- Goldman Sachs - Singapore
- Aboitiz Power Corporation - Philippines
- ICICI Bank Limited - India
- PowerSource Philippines DevCo
- Chamber of Mines of South Africa
- Malabar Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Altura Mining Limited, Indonesia
- Bulk Trading Sa - Switzerland
- Kalimantan Lumbung Energi - Indonesia
- Kapuas Tunggal Persada - Indonesia
- IEA Clean Coal Centre - UK
- Ambuja Cements Ltd - India
- Mercuria Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Attock Cement Pakistan Limited
- Neyveli Lignite Corporation Ltd, - India
- The State Trading Corporation of India Ltd
- Eastern Coal Council - USA
- Antam Resourcindo - Indonesia
- Energy Development Corp, Philippines
- Miang Besar Coal Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- PNOC Exploration Corporation - Philippines
- Australian Coal Association
- Banpu Public Company Limited - Thailand
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- South Luzon Thermal Energy Corporation
- Bharathi Cement Corporation - India
- Bangladesh Power Developement Board
- Kepco SPC Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Global Green Power PLC Corporation, Philippines
- Minerals Council of Australia
- The University of Queensland
- GVK Power & Infra Limited - India
- Global Business Power Corporation, Philippines
- Star Paper Mills Limited - India
- Baramulti Group, Indonesia
- The Treasury - Australian Government
- Eastern Energy - Thailand
- TeaM Sual Corporation - Philippines
- Siam City Cement PLC, Thailand
- Binh Thuan Hamico - Vietnam
- Semirara Mining and Power Corporation, Philippines
- White Energy Company Limited
- Latin American Coal - Colombia
- Kumho Petrochemical, South Korea
- Madhucon Powers Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Chettinad Cement Corporation Ltd - India
- Tata Chemicals Ltd - India
- Indian Energy Exchange, India
- Videocon Industries ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Samtan Co., Ltd - South Korea
- Lanco Infratech Ltd - India
- Orica Australia Pty. Ltd.
- Oldendorff Carriers - Singapore
- SMC Global Power, Philippines
- Power Finance Corporation Ltd., India
- Heidelberg Cement - Germany
- Trasteel International SA, Italy
- SMG Consultants - Indonesia
- Coalindo Energy - Indonesia
- Parliament of New Zealand
- India Bulls Power Limited - India
- Straits Asia Resources Limited - Singapore
- CNBM International Corporation - China
- Bukit Baiduri Energy - Indonesia
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