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Tuesday, 01 October 13
DRY BULK MARKET POISED FOR RETREAT ON CHINA HOLIDAY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The start of a national weeklong in China as of Tuesday is expected to put a lid in the latest rally of the dry bulk freight market, as has always been the case in similar occasions. This trend has already been obvious, by tracking the latest couple of sessions of the industry's benchmark, the Baltic Dry Index. The BDI was down 43 points yesterday, to end at 2,003 points, still more than double than the level of this past summer. The Capesize market witnessed the widest losses, which again was to be expected, given that most of the Capesize business is coming out of China. The BCI (Baltic Capesize Index) was down by 114 points to 3,853. Marginal losses were again obvious in the Panamax market, while smaller ship classes fared better, with Supramaxes rising by 10 points and Handysizes by three points to 1,079 and 597 respectively.
Capt. Jitesh Jaipuriyar, Chief Operating officer with Emerald Maritime, Dubai, offered Hellenic Shipping News Worldwide (www.hellenicshippingnews.com) an insight, regarding this latest rally of the dry bulk market, which has been fuelled by factors both "upstream" and "downstream". In the upstream factors, Capt. Jaipuriyar, noted that "miners are not able to sell at higher costs as there are few “takers”. India and China, as one of the most prospective import economies, are unable to support high raw material prices due to currency devaluation and slow growth combined. However, a miner may not be able to feed supply at the same cost for long as it threatens the very survival. Thus, the importer is forced to pay for high raw material prices which eventually is directly correlated to BDI upswing and supports the rally", he stated.
Regarding downstream factors, Capt. said that "in the current scenario, any increase in prices of raw materials, shall force miners to pass on the rises to the end users, in order to maintain profit margins, especially if this trend continues for an extended period. For shipping to recover, then this period has to be extended. Does it mean that it would bring “Inflationary pressure” in emerging economies? Not necessary. This is because when pressure builds up on downstream, other “balancing factors” shall come into play" he says.
According to Capt. Jaipuriyar, at this stage "the following question arises, if the high raw materials cost shall be able to create a “derived demand” or not. What we see as of now may not be real derived demand but more of a “Pseudo Demand”. Pseudo demand emerges from the constraint of choices a company has when having contracted out spot rates. This will show increased demand through paying more for shipping of the materials. However, the fact remains that companies have to commit to long term contracts (LTCs) and soaring period rates would not allow them to contract ships at lesser Time-Charter equivalents. But LTCs can play ‘Wait and watch’ game. This again contributes to pool of “pseudo demand” to be capitalized later and would support the rally", he says.
BULLWHIP EFFECT & “DECOUPLING”
"Last month, A Capesize stem from Australia to China, cost USD 14 per MT whereas same when slit in two panamaxes, costs only USD 13 per MT. This is against the economy of scale. So, how does it happen? When the demand goes up, a producer goes for bigger volumes and Capes rate go high. Due to limited Capes, the demand for smaller sizes down the chain increases which in effect creates a ‘Bullwhip effect’ to drive the demand for ships and rallies BDI overall.
So, at some point of time, the economic principles “decouple” with existing demand and supply scenario and lead to speculations. This in turn brings in volatility in the market. But the end demand drives it in sustainable way in spite of creation of multiple peaks and troughs on the way.
ROAD AHEAD
There have been many attempts to forecast BDIs in past and will continued to be explored. However, interestingly, it appears that the accuracy of forecasts lies not in “correlation” but possible “negative correlations”. It is for the fact that a positive correlation is not mere a result of one factor but a combination of many. Under such circumstances, it may not be possible to substantiate a proper or perfect “weightage” to one factor or another. But, past shows that gold, CRB (Commodity research bureau index) and crude prices often indicate how the negative correlation is building up and may help forecast BDI for short runs, possibly.
Overall, market remains upbeat for positive growth as stockpiles of grains and coal and other major commodities remain high to be shipped across the geographies", he concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Sunday, 10 November 13
PANAMAX COAL FREIGHT RATES REMAIN UNDER PRESSURE; SUPRAMAX BIGGEST GAINER - REDDY
COALspot.com: The freight market was up this week with all indices increased except for Panamax index.
The BDI was up by 56 points closing at 158 ...
Friday, 08 November 13
DRY BULK MARKET BOUNCES BACK ON RENEWED DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market staged a mild comeback this week, as the industry's benchmark, the Baltic Dry Index (BDI) inched forward step by step and bit b ...
Friday, 08 November 13
US'S OCTOBER COAL PRODUCTION INCREASED BY 1.78% M-M - EIA
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.3 million short tons (mmst) of coal in ...
Thursday, 07 November 13
FORMOSA PLASTICS SEEKS 80K MT OF 5850 GAR COAL
COALspot.com: Taiwan's Formosa Plastics Group is inviting bids for 80,000 mt of bituminous coal for delivery in Nov - Dec'13 for its Chi ...
Thursday, 07 November 13
INDONESIAN COAL EXPORT VOLUME INCREASED; REVENUE DECREASED
COALspot.com: Indonesia, the 15th largest economy, 4th largest coal producer in the world and world's largest multi grade coal exporter shipp ...
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- South Luzon Thermal Energy Corporation
- Xindia Steels Limited - India
- Vedanta Resources Plc - India
- Singapore Mercantile Exchange
- Thiess Contractors Indonesia
- Indonesian Coal Mining Association
- India Bulls Power Limited - India
- Edison Trading Spa - Italy
- Riau Bara Harum - Indonesia
- Makarim & Taira - Indonesia
- McConnell Dowell - Australia
- Indian Energy Exchange, India
- Merrill Lynch Commodities Europe
- PowerSource Philippines DevCo
- Tamil Nadu electricity Board
- PTC India Limited - India
- Pendopo Energi Batubara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Samtan Co., Ltd - South Korea
- Mintek Dendrill Indonesia
- Electricity Generating Authority of Thailand
- Global Green Power PLC Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Aditya Birla Group - India
- Goldman Sachs - Singapore
- Marubeni Corporation - India
- Renaissance Capital - South Africa
- Banpu Public Company Limited - Thailand
- Posco Energy - South Korea
- Bulk Trading Sa - Switzerland
- Formosa Plastics Group - Taiwan
- GAC Shipping (India) Pvt Ltd
- Energy Development Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Bukit Makmur.PT - Indonesia
- Star Paper Mills Limited - India
- Antam Resourcindo - Indonesia
- CNBM International Corporation - China
- GN Power Mariveles Coal Plant, Philippines
- Uttam Galva Steels Limited - India
- Kobexindo Tractors - Indoneisa
- Trasteel International SA, Italy
- Electricity Authority, New Zealand
- Mercator Lines Limited - India
- Barasentosa Lestari - Indonesia
- Bangladesh Power Developement Board
- Price Waterhouse Coopers - Russia
- SMC Global Power, Philippines
- European Bulk Services B.V. - Netherlands
- Chamber of Mines of South Africa
- Intertek Mineral Services - Indonesia
- LBH Netherlands Bv - Netherlands
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- VISA Power Limited - India
- Coastal Gujarat Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- Attock Cement Pakistan Limited
- Sindya Power Generating Company Private Ltd
- Indogreen Group - Indonesia
- Iligan Light & Power Inc, Philippines
- Eastern Coal Council - USA
- Vijayanagar Sugar Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Power Finance Corporation Ltd., India
- Coal and Oil Company - UAE
- Commonwealth Bank - Australia
- Port Waratah Coal Services - Australia
- Sarangani Energy Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- GMR Energy Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Africa Commodities Group - South Africa
- Toyota Tsusho Corporation, Japan
- Kaltim Prima Coal - Indonesia
- Interocean Group of Companies - India
- Agrawal Coal Company - India
- Anglo American - United Kingdom
- Alfred C Toepfer International GmbH - Germany
- Malabar Cements Ltd - India
- Australian Coal Association
- Manunggal Multi Energi - Indonesia
- Essar Steel Hazira Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Binh Thuan Hamico - Vietnam
- Parliament of New Zealand
- Carbofer General Trading SA - India
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Mines - Canada
- The University of Queensland
- PetroVietnam Power Coal Import and Supply Company
- Ministry of Finance - Indonesia
- White Energy Company Limited
- Jaiprakash Power Ventures ltd
- Bhatia International Limited - India
- Kideco Jaya Agung - Indonesia
- Videocon Industries ltd - India
- Siam City Cement PLC, Thailand
- Minerals Council of Australia
- Bhoruka Overseas - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Australian Commodity Traders Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Global Business Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Siam City Cement - Thailand
- Parry Sugars Refinery, India
- Gujarat Mineral Development Corp Ltd - India
- IHS Mccloskey Coal Group - USA
- ICICI Bank Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Ind-Barath Power Infra Limited - India
- Semirara Mining and Power Corporation, Philippines
- The Treasury - Australian Government
- Semirara Mining Corp, Philippines
- Coalindo Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kartika Selabumi Mining - Indonesia
- Planning Commission, India
- International Coal Ventures Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Cigading International Bulk Terminal - Indonesia
- Bharathi Cement Corporation - India
- Indian Oil Corporation Limited
- Sree Jayajothi Cements Limited - India
- Miang Besar Coal Terminal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- The State Trading Corporation of India Ltd
- Aboitiz Power Corporation - Philippines
- Lanco Infratech Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Bayan Resources Tbk. - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Petron Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Maheswari Brothers Coal Limited - India
- Therma Luzon, Inc, Philippines
- Global Coal Blending Company Limited - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Karaikal Port Pvt Ltd - India
- Kumho Petrochemical, South Korea
- TeaM Sual Corporation - Philippines
- MS Steel International - UAE
- Altura Mining Limited, Indonesia
- Orica Australia Pty. Ltd.
- Standard Chartered Bank - UAE
- Medco Energi Mining Internasional
- Independent Power Producers Association of India
- Chettinad Cement Corporation Ltd - India
- Latin American Coal - Colombia
- Rashtriya Ispat Nigam Limited - India
- CIMB Investment Bank - Malaysia
- SMG Consultants - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Heidelberg Cement - Germany
- Tata Chemicals Ltd - India
- New Zealand Coal & Carbon
- Straits Asia Resources Limited - Singapore
- Salva Resources Pvt Ltd - India
- Sakthi Sugars Limited - India
- Sojitz Corporation - Japan
- SN Aboitiz Power Inc, Philippines
- Eastern Energy - Thailand
- Romanian Commodities Exchange
- Ambuja Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Georgia Ports Authority, United States
- Bukit Baiduri Energy - Indonesia
- Sical Logistics Limited - India
- Larsen & Toubro Limited - India
- Ministry of Transport, Egypt
- AsiaOL BioFuels Corp., Philippines
- Meralco Power Generation, Philippines
- Globalindo Alam Lestari - Indonesia
- Rio Tinto Coal - Australia
- Thai Mozambique Logistica
- Indika Energy - Indonesia
- Baramulti Group, Indonesia
- OPG Power Generation Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Oldendorff Carriers - Singapore
- Mjunction Services Limited - India
- Cement Manufacturers Association - India
- Dalmia Cement Bharat India
- Ceylon Electricity Board - Sri Lanka
- Orica Mining Services - Indonesia
- Meenaskhi Energy Private Limited - India
- Central Electricity Authority - India
- Directorate General of MIneral and Coal - Indonesia
- Savvy Resources Ltd - HongKong
- IEA Clean Coal Centre - UK
- Madhucon Powers Ltd - India
- Jindal Steel & Power Ltd - India
- Economic Council, Georgia
- Sinarmas Energy and Mining - Indonesia
- San Jose City I Power Corp, Philippines
- Mercuria Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Vizag Seaport Private Limited - India
- Wood Mackenzie - Singapore
- Directorate Of Revenue Intelligence - India
- GVK Power & Infra Limited - India
- Metalloyd Limited - United Kingdom
- Deloitte Consulting - India
- Kepco SPC Power Corporation, Philippines
- Wilmar Investment Holdings
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Borneo Indobara - Indonesia
- Central Java Power - Indonesia
- Grasim Industreis Ltd - India
- London Commodity Brokers - England
- ASAPP Information Group - India
- Energy Link Ltd, New Zealand
- Bhushan Steel Limited - India
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