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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 around and what we got – but did not anticipate. As the Summer heat arrived, Capesize owners found themselves basking in the sun. Average earnings for Capesize vessels went from USD 6,000 per day to USD 12,000 per day in less than two weeks. The momentum lifted rates as high as USD 15,218 per day on 1 July. This was a sizeable and very welcome surprise as the combination, once again, of vessels being at the “right place at the right time” proved to be profitable. As Brazilian iron ore exports in particular jumped after some weaker months, congestion at load ports rose and charterers were left searching for prompt and available tonnage. At the same time, Australian iron ore ports were hit by heavy rainfall which also affected shipping. It is a little miracle that tight situations can still appear and push up freight rates, in spite of tonnage being abundant in the market. Since the 1 July peak, freight rates have slid slowly, as the imbalanced market is smoothed by ballasting tonnage returning to the Atlantic from the Far East. Some of the weakness in most of H1 is due to the fact that Brazil has been losing some of its share of the iron ore market to Australia.
Besides that, the market is affected by falling commodity prices (iron ore, steel and coal). This could, in theory, positively affect shipping demand if consumers and traders take advantage of it and stock up, but it may as well mirror a fundamental slowdown in demand.
No slowdown is seen in steel production fortunately, at Chinese steel production went up by 9.2% in the first half as compared to same period last year. Iron ore imports “only” went up by 4.8% in the same period of time. Both indicators are positive for shipping demand. Traditionally, Chinese iron ore demand is stronger in the second half of the year; this could build a case for stronger rates in the larger segments in Q3 and Q4 if this seasonality is repeated.
The larger production of steel and moderate consumption of same has put steel prices under pressure. Falling steel prices are normally quite worrying for the dry bulk sector. In the wake of several months with record high steel production, prices weakened continuously, getting quite close to the threateningly low levels of August/September 2012. But has the scare just evaporated with the latest pick up in prices toward the end of July? That is still too early to call despite the optimism in most recent “official” China manufacturing PMI report.
Supply:
During the past two months, 10 million DWT of new tonnage has joined the dry bulk fleet, which now totals at 704 million DWT. This is up by 3.6% since 1 January.
Looking at future delivery prospect, 70% of all new orders placed during the past two months have been for 2015 delivery. In addition to some postponements, this has pushed the projected orders for 2015 delivery up from 20 million to 25 million DWT.
For 2013, BIMCO projects new tonnage of 70 million to hit the water, a four-year low, and a gradual return to a lower supply pressure on the market.
While new orders have been fairly equally distributed for the past two months as a whole, June saw a flurry of Supramax orders whereas July was pretty biased towards Capesize vessels. As a lot of Panamax ships are currently being delivered into an oversupplied market, owners showed only little appetite for placing new orders for Panamax ships.
In total, the dry bulk order book has grown by 3.2 million DWT during the recent two months. It now stands at 126 million DWT. It’s the first time in more than two and a half years that the order book has increased, on its way down from 300 million DWT highs at the end of 2010.
As 29 million DWT of new vessels have been ordered so far in 2013, the total has already surpassed that of the full year 2012. This development seems to have stopped the slide of new building prices, which are now seen to be on a slow rise, with the exception of Panamax new building prices which are still flat, as demand does not support higher prices in this segment yet.
Outlook:
As the global and Chinese GDP are now seen lower than earlier in the year, we also have to settle for something that might be the sixth consecutive year of supply outpacing demand. But the race is still on, as supply is set for 5.7% and demand for 5-6%.
China’s import of agricultural products could provide some upside, as wheat and soybeans could end up falling short of demand due to adverse weather conditions. If imports of wheat are supplied predominantly by US producers, which is likely, this may bring some growth in demand due to long sailing distances. The same effect can be expected by increased Brazilian exports of soybeans in the second half of the year following a congestion-affected export level in the January-May period.
In recent months, Asian thermal coal prices have nose-dived, as plenty of coal is offered in the market. Utilities are no longer worried about running stocks low, as supply is excessive. During the second quarter, Russian, Columbian and American coal was also offered into the market, putting further pressure on traditional Indonesian and Australian coal markets. FOB thermal coal prices for “Newcastle 5500” or “Richards Bay 5500” were just above USD 66 per Mt coming down from USD 75 per Mt and USD 72 per Mt respectively. As we know, demand is healthy, the lower prices could prove a catalyst for higher freight rates as we move further into Q3. Further weakening of the Indian Rupee or the Japanese Yen could dampen the positive effect somewhat.
To sum up, our forecast for the coming 2 months:
BIMCO holds the view that Capesize TC average rates are expected around USD 8,000-13,000 per day.
Panamax is expected to stay in the USD 6,000-9,000 per day interval.
For the Supramax segment, BIMCO forecasts freight rates in the USD 8,000-11,000 per day interval,
whereas Handysize rates are forecast to show limited volatility in the interval of USD 6,500-9,000 per day.
Source: BIMCO Peter Sand Chief Shipping Analyst / Hellenic Shipping
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Tuesday, 23 April 13
REALM CONTINUES AS 51% OWNER AND MANAGER OF THE KATINGAN RIA THERMAL COAL PROJECT
COALspot.com - Realm Resources Ltd. (ASX: RRP) has announced today that, the commercial way forward for the development of its 51% held Indonesian t ...
Tuesday, 23 April 13
TIGERS REALM COAL HAS SOME OF THE WORLD'S BEST UNDEVELOPED COKING COAL ASSETS - EXECUTIVE CHAIRMAN
COALspot.com - “ During 2012, your Company has made very significant progress towards meeting its stated objective of becoming a global player ...
Tuesday, 23 April 13
AUSTRALIA'S NEWCASTLE PORT COAL SHIPMENTS DROPPED BY 4.38 PERCENT W-O-W
COALspot.com - Newcastle port in Australia has loaded 2,434,336 tons of thermal and coking coal for week ended 0700 hours 22 April 2013, Newca ...
Sunday, 21 April 13
INDONESIA - INDIA COAL FREIGHT RATES ARE FIRMING UP - CAPT. REDDY
COALspot.com – The BDI was up by 1.40 pct closed at 888 points week ended 19 April 2013. The Cape index was down by 2.45 pct closing at 1234 p ...
Friday, 19 April 13
FIRST QUARTER OF 2013 PROVEN A POSITIVE SURPRISE FOR DRY BULK MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite ominous predictions regarding the negative performance of the dry bulk market during the – traditionally weak anyway – first qua ...
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- OPG Power Generation Pvt Ltd - India
- Bharathi Cement Corporation - India
- GN Power Mariveles Coal Plant, Philippines
- Makarim & Taira - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Interocean Group of Companies - India
- Larsen & Toubro Limited - India
- Global Green Power PLC Corporation, Philippines
- GMR Energy Limited - India
- Intertek Mineral Services - Indonesia
- Carbofer General Trading SA - India
- Attock Cement Pakistan Limited
- Kumho Petrochemical, South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Grasim Industreis Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Gujarat Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Madhucon Powers Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Central Electricity Authority - India
- Tamil Nadu electricity Board
- GAC Shipping (India) Pvt Ltd
- The Treasury - Australian Government
- Orica Australia Pty. Ltd.
- Indika Energy - Indonesia
- Coal and Oil Company - UAE
- Energy Link Ltd, New Zealand
- Directorate Of Revenue Intelligence - India
- Rashtriya Ispat Nigam Limited - India
- Bulk Trading Sa - Switzerland
- Mjunction Services Limited - India
- Merrill Lynch Commodities Europe
- Vizag Seaport Private Limited - India
- Bhushan Steel Limited - India
- Renaissance Capital - South Africa
- Chamber of Mines of South Africa
- Latin American Coal - Colombia
- Sree Jayajothi Cements Limited - India
- Gujarat Sidhee Cement - India
- Jaiprakash Power Ventures ltd
- Heidelberg Cement - Germany
- Bangladesh Power Developement Board
- Semirara Mining and Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- Australian Commodity Traders Exchange
- Pendopo Energi Batubara - Indonesia
- GVK Power & Infra Limited - India
- Maharashtra Electricity Regulatory Commission - India
- International Coal Ventures Pvt Ltd - India
- Energy Development Corp, Philippines
- Indogreen Group - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kapuas Tunggal Persada - Indonesia
- Global Business Power Corporation, Philippines
- Australian Coal Association
- Orica Mining Services - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Bukit Baiduri Energy - Indonesia
- The State Trading Corporation of India Ltd
- AsiaOL BioFuels Corp., Philippines
- Karaikal Port Pvt Ltd - India
- Mintek Dendrill Indonesia
- Ministry of Transport, Egypt
- VISA Power Limited - India
- Kobexindo Tractors - Indoneisa
- Kaltim Prima Coal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- Neyveli Lignite Corporation Ltd, - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Edison Trading Spa - Italy
- Kepco SPC Power Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Salva Resources Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Commonwealth Bank - Australia
- Petron Corporation, Philippines
- Bhoruka Overseas - Indonesia
- LBH Netherlands Bv - Netherlands
- Sindya Power Generating Company Private Ltd
- Directorate General of MIneral and Coal - Indonesia
- Chettinad Cement Corporation Ltd - India
- McConnell Dowell - Australia
- Banpu Public Company Limited - Thailand
- Bukit Makmur.PT - Indonesia
- Rio Tinto Coal - Australia
- Sarangani Energy Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Indian Energy Exchange, India
- Power Finance Corporation Ltd., India
- Sical Logistics Limited - India
- Baramulti Group, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Ambuja Cements Ltd - India
- Sakthi Sugars Limited - India
- Thai Mozambique Logistica
- White Energy Company Limited
- Siam City Cement PLC, Thailand
- CNBM International Corporation - China
- Sinarmas Energy and Mining - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Goldman Sachs - Singapore
- Electricity Authority, New Zealand
- Krishnapatnam Port Company Ltd. - India
- Ind-Barath Power Infra Limited - India
- Aditya Birla Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mercator Lines Limited - India
- Malabar Cements Ltd - India
- TeaM Sual Corporation - Philippines
- Anglo American - United Kingdom
- Cement Manufacturers Association - India
- CIMB Investment Bank - Malaysia
- Kohat Cement Company Ltd. - Pakistan
- Parry Sugars Refinery, India
- Trasteel International SA, Italy
- Mercuria Energy - Indonesia
- Eastern Coal Council - USA
- Antam Resourcindo - Indonesia
- Borneo Indobara - Indonesia
- Lanco Infratech Ltd - India
- Electricity Generating Authority of Thailand
- Iligan Light & Power Inc, Philippines
- Coalindo Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- Essar Steel Hazira Ltd - India
- New Zealand Coal & Carbon
- PNOC Exploration Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Africa Commodities Group - South Africa
- Oldendorff Carriers - Singapore
- Simpson Spence & Young - Indonesia
- Wood Mackenzie - Singapore
- Indian Oil Corporation Limited
- Parliament of New Zealand
- Altura Mining Limited, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Agrawal Coal Company - India
- Tata Chemicals Ltd - India
- PTC India Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Coastal Gujarat Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Dalmia Cement Bharat India
- Wilmar Investment Holdings
- Karbindo Abesyapradhi - Indoneisa
- Sojitz Corporation - Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Cigading International Bulk Terminal - Indonesia
- Georgia Ports Authority, United States
- Toyota Tsusho Corporation, Japan
- Port Waratah Coal Services - Australia
- The University of Queensland
- Timah Investasi Mineral - Indoneisa
- London Commodity Brokers - England
- Vijayanagar Sugar Pvt Ltd - India
- Indonesian Coal Mining Association
- Leighton Contractors Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Price Waterhouse Coopers - Russia
- India Bulls Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Meralco Power Generation, Philippines
- Samtan Co., Ltd - South Korea
- Riau Bara Harum - Indonesia
- Videocon Industries ltd - India
- Savvy Resources Ltd - HongKong
- Standard Chartered Bank - UAE
- Indo Tambangraya Megah - Indonesia
- Singapore Mercantile Exchange
- Barasentosa Lestari - Indonesia
- Romanian Commodities Exchange
- PowerSource Philippines DevCo
- ASAPP Information Group - India
- Siam City Cement - Thailand
- Central Java Power - Indonesia
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- Straits Asia Resources Limited - Singapore
- SMC Global Power, Philippines
- Star Paper Mills Limited - India
- Maheswari Brothers Coal Limited - India
- Formosa Plastics Group - Taiwan
- Economic Council, Georgia
- Marubeni Corporation - India
- Jindal Steel & Power Ltd - India
- Therma Luzon, Inc, Philippines
- Global Coal Blending Company Limited - Australia
- Semirara Mining Corp, Philippines
- Bhatia International Limited - India
- San Jose City I Power Corp, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Vedanta Resources Plc - India
- Manunggal Multi Energi - Indonesia
- Posco Energy - South Korea
- TNB Fuel Sdn Bhd - Malaysia
- European Bulk Services B.V. - Netherlands
- Independent Power Producers Association of India
- Thiess Contractors Indonesia
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Jorong Barutama Greston.PT - Indonesia
- ICICI Bank Limited - India
- Minerals Council of Australia
- Ministry of Finance - Indonesia
- Bayan Resources Tbk. - Indonesia
- Planning Commission, India
- Xindia Steels Limited - India
- Deloitte Consulting - India
- Eastern Energy - Thailand
- Medco Energi Mining Internasional
- Globalindo Alam Lestari - Indonesia
- Kideco Jaya Agung - Indonesia
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