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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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Tuesday, 13 August 13
AUSTRALIA NEWCASTLE COAL EXPORTS JUMP 30.61 PERCENT ON WEEK
COALspot.com: Power plant and semi-soft coking coal shipments from Australia's Newcastle port up 30.61 per cent week on week to 2.95 million mt for ...
Monday, 12 August 13
GBCE SUCCESSFUL IN UPGRADING LOW RANK INDONESIAN COAL ON INDUSTRIAL SCALE
COALspot.com : GB Clean Energy Ltd. (GBCE) has annoused that, the company has successfully upgraded 2,426 tonnes of low rank 4,018 kcal NAR Ind ...
Monday, 12 August 13
INDIA - SAFE SHIPMENT OF IRON ORE FINES FROM INDIAN PORTS - WEST OF ENGLAND P&I CLUB
As Members may be aware, in 2009 two ships, the ‘Asian Forest’ and the ‘Black Rose’, capsized and sank following the liquefa ...
Sunday, 11 August 13
INDONESIAN COAL SWAPS : FLAT ON DAY
COALspot.com – Sub-Bit Indonesia coal swaps (FOB ) for average Q4 2013 delivery flat on day due to holidays in Indonesia, Malaysia & ...
Sunday, 11 August 13
SUPRAMAX FREIGHT RATES FROM INDONESIA TO INDIA CONTINUED TO BE SOFT - VISTAAR
COALspot.com : The freight market was soft this week with all indices down , the reason could be long weekend holidays in Indonesia, Singapore and M ...
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- Leighton Contractors Pty Ltd - Australia
- Planning Commission, India
- Globalindo Alam Lestari - Indonesia
- Anglo American - United Kingdom
- Eastern Coal Council - USA
- Global Green Power PLC Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- VISA Power Limited - India
- Therma Luzon, Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Samtan Co., Ltd - South Korea
- Singapore Mercantile Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Finance - Indonesia
- Electricity Authority, New Zealand
- Siam City Cement - Thailand
- Indika Energy - Indonesia
- South Luzon Thermal Energy Corporation
- Kepco SPC Power Corporation, Philippines
- Goldman Sachs - Singapore
- Intertek Mineral Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Africa Commodities Group - South Africa
- Australian Commodity Traders Exchange
- The Treasury - Australian Government
- Lanco Infratech Ltd - India
- Eastern Energy - Thailand
- MS Steel International - UAE
- AsiaOL BioFuels Corp., Philippines
- The State Trading Corporation of India Ltd
- Vizag Seaport Private Limited - India
- Madhucon Powers Ltd - India
- GMR Energy Limited - India
- Orica Mining Services - Indonesia
- Aboitiz Power Corporation - Philippines
- Indogreen Group - Indonesia
- Bhushan Steel Limited - India
- Georgia Ports Authority, United States
- Tata Chemicals Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Merrill Lynch Commodities Europe
- Manunggal Multi Energi - Indonesia
- Mercuria Energy - Indonesia
- Minerals Council of Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- GVK Power & Infra Limited - India
- Power Finance Corporation Ltd., India
- Formosa Plastics Group - Taiwan
- Petron Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Xindia Steels Limited - India
- Bharathi Cement Corporation - India
- Agrawal Coal Company - India
- Semirara Mining and Power Corporation, Philippines
- Malabar Cements Ltd - India
- Sindya Power Generating Company Private Ltd
- Kalimantan Lumbung Energi - Indonesia
- Riau Bara Harum - Indonesia
- CIMB Investment Bank - Malaysia
- Simpson Spence & Young - Indonesia
- Electricity Generating Authority of Thailand
- Gujarat Mineral Development Corp Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Medco Energi Mining Internasional
- Baramulti Group, Indonesia
- Energy Link Ltd, New Zealand
- Jorong Barutama Greston.PT - Indonesia
- International Coal Ventures Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Sical Logistics Limited - India
- Krishnapatnam Port Company Ltd. - India
- Grasim Industreis Ltd - India
- Parliament of New Zealand
- Global Coal Blending Company Limited - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Salva Resources Pvt Ltd - India
- Standard Chartered Bank - UAE
- Sakthi Sugars Limited - India
- Cigading International Bulk Terminal - Indonesia
- IHS Mccloskey Coal Group - USA
- Indo Tambangraya Megah - Indonesia
- IEA Clean Coal Centre - UK
- Gujarat Electricity Regulatory Commission - India
- Videocon Industries ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TeaM Sual Corporation - Philippines
- Siam City Cement PLC, Thailand
- Chamber of Mines of South Africa
- Independent Power Producers Association of India
- Bahari Cakrawala Sebuku - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- London Commodity Brokers - England
- Kobexindo Tractors - Indoneisa
- Dalmia Cement Bharat India
- Borneo Indobara - Indonesia
- Meenaskhi Energy Private Limited - India
- Miang Besar Coal Terminal - Indonesia
- Ministry of Mines - Canada
- New Zealand Coal & Carbon
- Savvy Resources Ltd - HongKong
- Kartika Selabumi Mining - Indonesia
- Romanian Commodities Exchange
- Aditya Birla Group - India
- Deloitte Consulting - India
- Chettinad Cement Corporation Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Sidhee Cement - India
- SMG Consultants - Indonesia
- Ministry of Transport, Egypt
- TNB Fuel Sdn Bhd - Malaysia
- Latin American Coal - Colombia
- Energy Development Corp, Philippines
- Economic Council, Georgia
- Cement Manufacturers Association - India
- White Energy Company Limited
- Maheswari Brothers Coal Limited - India
- Posco Energy - South Korea
- Marubeni Corporation - India
- Edison Trading Spa - Italy
- SMC Global Power, Philippines
- Kaltim Prima Coal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Bayan Resources Tbk. - Indonesia
- Heidelberg Cement - Germany
- Holcim Trading Pte Ltd - Singapore
- Central Electricity Authority - India
- LBH Netherlands Bv - Netherlands
- Sojitz Corporation - Japan
- Banpu Public Company Limited - Thailand
- Jaiprakash Power Ventures ltd
- Bukit Baiduri Energy - Indonesia
- Larsen & Toubro Limited - India
- Global Business Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Australian Coal Association
- Indonesian Coal Mining Association
- Mercator Lines Limited - India
- Thiess Contractors Indonesia
- Barasentosa Lestari - Indonesia
- Indian Oil Corporation Limited
- Timah Investasi Mineral - Indoneisa
- Rio Tinto Coal - Australia
- Pendopo Energi Batubara - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Bulk Trading Sa - Switzerland
- McConnell Dowell - Australia
- Essar Steel Hazira Ltd - India
- PNOC Exploration Corporation - Philippines
- Wood Mackenzie - Singapore
- Interocean Group of Companies - India
- Oldendorff Carriers - Singapore
- European Bulk Services B.V. - Netherlands
- PTC India Limited - India
- Iligan Light & Power Inc, Philippines
- Carbofer General Trading SA - India
- Price Waterhouse Coopers - Russia
- GN Power Mariveles Coal Plant, Philippines
- Directorate Of Revenue Intelligence - India
- Attock Cement Pakistan Limited
- Neyveli Lignite Corporation Ltd, - India
- Uttam Galva Steels Limited - India
- Mjunction Services Limited - India
- Central Java Power - Indonesia
- Altura Mining Limited, Indonesia
- Tamil Nadu electricity Board
- Makarim & Taira - Indonesia
- Coalindo Energy - Indonesia
- Ind-Barath Power Infra Limited - India
- Thai Mozambique Logistica
- Bhoruka Overseas - Indonesia
- ASAPP Information Group - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Commonwealth Bank - Australia
- Wilmar Investment Holdings
- Binh Thuan Hamico - Vietnam
- India Bulls Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Ceylon Electricity Board - Sri Lanka
- Kumho Petrochemical, South Korea
- Coal and Oil Company - UAE
- Asmin Koalindo Tuhup - Indonesia
- Trasteel International SA, Italy
- Bukit Makmur.PT - Indonesia
- Antam Resourcindo - Indonesia
- Karaikal Port Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Meralco Power Generation, Philippines
- Metalloyd Limited - United Kingdom
- Semirara Mining Corp, Philippines
- Coastal Gujarat Power Limited - India
- Ambuja Cements Ltd - India
- Kapuas Tunggal Persada - Indonesia
- OPG Power Generation Pvt Ltd - India
- Renaissance Capital - South Africa
- Bhatia International Limited - India
- Vedanta Resources Plc - India
- Jindal Steel & Power Ltd - India
- Toyota Tsusho Corporation, Japan
- The University of Queensland
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parry Sugars Refinery, India
- Alfred C Toepfer International GmbH - Germany
- Kideco Jaya Agung - Indonesia
- Port Waratah Coal Services - Australia
- Straits Asia Resources Limited - Singapore
- Bangladesh Power Developement Board
- Mintek Dendrill Indonesia
- ICICI Bank Limited - India
- CNBM International Corporation - China
- Indian Energy Exchange, India
- Star Paper Mills Limited - India
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