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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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Thursday, 31 January 13
DRY BULK RATES ON A FALLING PATTERN DUE TO ADVERSE WEATHER CONDITIONS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The seasonal factor has emerged as the latest catalyst in determining the course of the dry bulk market, as the floods in eastern Australia, the big ...
Thursday, 31 January 13
NEWCASTLE PORT SHIPPED 2.70 MMT OF COAL W/E 28 JANUARY 2013
COALspot.com - Newcastle port in Australia has loaded 2,703,921 MT of thermal and coking coal for week ended 0700 hours 28 January 2013, Newca ...
Thursday, 31 January 13
MMTC TO IMPORT 2.68 MMT OF COAL FOR ARAVALI POWER CORPORATION LTD
COALspot.com: The tender floated by MMTC on behalf of Aravali Power Corporation Ltd, a Joint venture between NTPC and State of Haryana for supply of ...
Wednesday, 30 January 13
TNPL TO SECURE 300K MT OF IMPORTED COAL SUPPLIES AT US$ 75.95 PMT FOR MARCH - AUGUST 2013 DELIVERY
COALspot.com – Chennai based Coastal Energy Private Limited (C&O Group of companies) offered lowest price of US$ 75.95 per met ...
Monday, 28 January 13
BAYAN RESOURCES TO SELL 18 MILLION TONS OF COAL TO GNPOWER MARIVELES COAL PLANT
Publicly-listed PT Bayan Resources announced on Friday that it had signed an agreement on coal sales with Philippine-based GNPower Mariveles Coal Pl ...
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- Singapore Mercantile Exchange
- Bhushan Steel Limited - India
- Gujarat Electricity Regulatory Commission - India
- Bangladesh Power Developement Board
- Grasim Industreis Ltd - India
- Videocon Industries ltd - India
- Minerals Council of Australia
- Ind-Barath Power Infra Limited - India
- Indogreen Group - Indonesia
- The State Trading Corporation of India Ltd
- Binh Thuan Hamico - Vietnam
- Central Electricity Authority - India
- ICICI Bank Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- MS Steel International - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Directorate General of MIneral and Coal - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Savvy Resources Ltd - HongKong
- Planning Commission, India
- Kalimantan Lumbung Energi - Indonesia
- Timah Investasi Mineral - Indoneisa
- Salva Resources Pvt Ltd - India
- Indian Energy Exchange, India
- Jaiprakash Power Ventures ltd
- Manunggal Multi Energi - Indonesia
- Maheswari Brothers Coal Limited - India
- Baramulti Group, Indonesia
- Africa Commodities Group - South Africa
- PNOC Exploration Corporation - Philippines
- Global Coal Blending Company Limited - Australia
- Aditya Birla Group - India
- Chettinad Cement Corporation Ltd - India
- Samtan Co., Ltd - South Korea
- PTC India Limited - India
- Deloitte Consulting - India
- Alfred C Toepfer International GmbH - Germany
- Medco Energi Mining Internasional
- Bukit Baiduri Energy - Indonesia
- LBH Netherlands Bv - Netherlands
- Mercator Lines Limited - India
- Global Green Power PLC Corporation, Philippines
- Meralco Power Generation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Energy Development Corp, Philippines
- India Bulls Power Limited - India
- Indika Energy - Indonesia
- Makarim & Taira - Indonesia
- Thiess Contractors Indonesia
- Orica Mining Services - Indonesia
- Wilmar Investment Holdings
- Commonwealth Bank - Australia
- Agrawal Coal Company - India
- Price Waterhouse Coopers - Russia
- Petron Corporation, Philippines
- Ministry of Finance - Indonesia
- Barasentosa Lestari - Indonesia
- TeaM Sual Corporation - Philippines
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Attock Cement Pakistan Limited
- Toyota Tsusho Corporation, Japan
- Directorate Of Revenue Intelligence - India
- Karaikal Port Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Australian Commodity Traders Exchange
- ASAPP Information Group - India
- Coalindo Energy - Indonesia
- GMR Energy Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bukit Makmur.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Wood Mackenzie - Singapore
- Sree Jayajothi Cements Limited - India
- Madhucon Powers Ltd - India
- New Zealand Coal & Carbon
- European Bulk Services B.V. - Netherlands
- Bayan Resources Tbk. - Indonesia
- The University of Queensland
- Antam Resourcindo - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Ministry of Mines - Canada
- Independent Power Producers Association of India
- Uttam Galva Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bharathi Cement Corporation - India
- Mercuria Energy - Indonesia
- Australian Coal Association
- Asmin Koalindo Tuhup - Indonesia
- Coal and Oil Company - UAE
- Energy Link Ltd, New Zealand
- Parry Sugars Refinery, India
- International Coal Ventures Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- PetroVietnam Power Coal Import and Supply Company
- Iligan Light & Power Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- PowerSource Philippines DevCo
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Altura Mining Limited, Indonesia
- Vizag Seaport Private Limited - India
- Metalloyd Limited - United Kingdom
- Renaissance Capital - South Africa
- Aboitiz Power Corporation - Philippines
- Gujarat Mineral Development Corp Ltd - India
- Oldendorff Carriers - Singapore
- Eastern Coal Council - USA
- Indo Tambangraya Megah - Indonesia
- Sakthi Sugars Limited - India
- Marubeni Corporation - India
- Intertek Mineral Services - Indonesia
- Simpson Spence & Young - Indonesia
- Tamil Nadu electricity Board
- Bulk Trading Sa - Switzerland
- Economic Council, Georgia
- Georgia Ports Authority, United States
- Merrill Lynch Commodities Europe
- Global Business Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Latin American Coal - Colombia
- White Energy Company Limited
- Ministry of Transport, Egypt
- CNBM International Corporation - China
- Coastal Gujarat Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Siam City Cement - Thailand
- Central Java Power - Indonesia
- Star Paper Mills Limited - India
- Therma Luzon, Inc, Philippines
- Bhoruka Overseas - Indonesia
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- IEA Clean Coal Centre - UK
- Trasteel International SA, Italy
- Riau Bara Harum - Indonesia
- SMG Consultants - Indonesia
- Interocean Group of Companies - India
- San Jose City I Power Corp, Philippines
- Neyveli Lignite Corporation Ltd, - India
- TNB Fuel Sdn Bhd - Malaysia
- Posco Energy - South Korea
- GAC Shipping (India) Pvt Ltd
- Sical Logistics Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Banpu Public Company Limited - Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Miang Besar Coal Terminal - Indonesia
- Indonesian Coal Mining Association
- Xindia Steels Limited - India
- Kumho Petrochemical, South Korea
- Port Waratah Coal Services - Australia
- Power Finance Corporation Ltd., India
- Anglo American - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- GVK Power & Infra Limited - India
- Parliament of New Zealand
- Larsen & Toubro Limited - India
- Essar Steel Hazira Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Sojitz Corporation - Japan
- Sarangani Energy Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Kobexindo Tractors - Indoneisa
- Thai Mozambique Logistica
- Bukit Asam (Persero) Tbk - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Malabar Cements Ltd - India
- Standard Chartered Bank - UAE
- Bhatia International Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Romanian Commodities Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- South Luzon Thermal Energy Corporation
- Rio Tinto Coal - Australia
- Borneo Indobara - Indonesia
- London Commodity Brokers - England
- Kepco SPC Power Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Electricity Authority, New Zealand
- Chamber of Mines of South Africa
- Heidelberg Cement - Germany
- Jindal Steel & Power Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Vedanta Resources Plc - India
- Mintek Dendrill Indonesia
- Lanco Infratech Ltd - India
- Sindya Power Generating Company Private Ltd
- CIMB Investment Bank - Malaysia
- Kideco Jaya Agung - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Cement Manufacturers Association - India
- Semirara Mining Corp, Philippines
- McConnell Dowell - Australia
- Tata Chemicals Ltd - India
- Indian Oil Corporation Limited
- OPG Power Generation Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Ambuja Cements Ltd - India
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- Meenaskhi Energy Private Limited - India
- Mjunction Services Limited - India
- Dalmia Cement Bharat India
- Siam City Cement PLC, Thailand
- Kapuas Tunggal Persada - Indonesia
- Sinarmas Energy and Mining - Indonesia
- IHS Mccloskey Coal Group - USA
- SN Aboitiz Power Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Ceylon Electricity Board - Sri Lanka
- Edison Trading Spa - Italy
- Bank of Tokyo Mitsubishi UFJ Ltd
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