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Thursday, 12 December 13
DRY BULK MARKET RATES FOR CAPESIZES TO REMAIN VOLATILE SAYS BIMCO
The dry bulk market has reached multi year highs this week, as the BDI is standing at the 2,300-point mark. In its analysis of the market, BIMCO predicted yesterday that the elevated level of Capesize Time Charter average rates will remain volatile and stay around USD 15,000-30,000 per day. Panamax TC average rates will stay in the region of USD 9,000-16,000 per day. For the Supramax segment, BIMCO forecasts freight rates in the USD 11,000-17,000 per day interval, whereas Handysize rates is expected to stay strong in the region of USD 9,000-12,000 per day.
According to the relative report, BIMCO noted that 2013 was a truly amazing year for Chinese iron ore imports. "A growth rate of 10.8% for the first 11 months as compared to the same period last year is solid. Evident also from the freight rate development in the Capesize market, the last 5 months have been exceptional, with 17.8% y-o-y growth for July-November. On top of that, coal imports (not all seaborne) have grown by 15.7% in January-October compared to the same period last year. As we move into a seasonally stronger part of the year for bulk trades, the November and December indications that are already visible point towards more strong numbers.
So far, we have not recorded any major impact on demand due to the announced 3% Chinese import tax on low calorific coal that should be in place now. Indonesia is expected to be affected by this to some extent, as almost all lignite imports into China originate from Indonesia".
It added that "as regards freight rates, the smaller segments of Handysize and Supramax have enjoyed an almost unbroken run of better earnings over a sustained period. Both segments are propelled forward by a strong Atlantic market, mainly driven by front-haul routes out of the US Gulf to Continental Europe and the North Coast of South America, mostly carrying grain.
Not since the middle of last year have we seen average Handysize rates above USD 10,000 per day. For Supramax, the stronger demand has meant average freight rates have gone from USD 10,000 per day to USD 15,000 per day. The 6-month TC rate has also gone up, indicating that the market does not believe this strength is about to instantly evaporate.
However, it will not last for very long if we use the same argument and look at the 1 and 3 year TC rates that have barely moved. When looking at Capesize TC rates, six months deals in the period market were quoted at USD 31,000 in September. As the market fell back during October to stabilise at the USD 15-20,000 per day interval during November, the breakaway in the short period market was neutralised. At the end of November, TC rates, regardless of duration, stood at the same level – indicating uncertainty about the future direction. FFA rates, on the other hand, are not quite as optimistic, but equally volatile when offering around USD 13,000 for a Q1-2014 contract in early December", BIMCO's analysts stated.
Supply
Meanwhile, in terms of tonnage supply, BIMCO said that "the fleet has now grown by 5.3% (55 million DWT) in 2013 with a further 7 million DWT still set for delivery in 2013. This means the full year fleet growth could hit 6% as the higher freight market has limited demolition activity. Since 1 July, just 6.3 million DWT has left the active fleet on that account.
Fleet growth in the Capesize segment has been going steeply South since the middle of last year, where the segment growth during the previous year reached 20%. Since then, the slow inflow of new tonnage in 2013 has left Capesize fleet growth at just 5% in October 2013. Panamax has been the fastest growing segment in 2013, but at a significantly lower peak level than the Capesize segment. It is more positive now for the Handysize segment, which has seen the fleet decrease in size this year as the demolition of 5.5 million DWT has offset the delivery of 5.3 million DWT.
The slowing trend in fleet growth will continue into next year and has not been wiped out completely by the hefty ordering activity we have witnessed in past two months – 136 new ships with a capacity of 13.3 million DWT. Amongst them were 20 VLOCs, 16 Capesizes and 24 Handysizes. Year-to-date contracting activity stand at 63.2 million DWT, this is on course to become higher for the full year than the combined bulk carrier contracting activity during 2011-2012" it said.
Outlook
For 2014, BIMCO expects that demand growth will range between 4½ and 6%, indicating that such strong growth will outstrip supply and bring about an improvement to the fundamental balance. According to BIMCO's head of shipping analysis, Peter Sand, "coal exports from the US have been growing since 2007. However, after a record-setting year in 2012, the numbers appear to be dwindling. Even though March this year set a record with 12.3 million tons, 7% higher than the record set in June 2012, it is not representative of the whole year. The exported total in the first nine months of 2013 is 7.5%, lower than that of the same time last year. Seen on a broader scale, however, the 2013 numbers are still around 100% higher than they were only 4 years ago. In combination with the long sailing distances that most US coal export routes hold, the trade has established itself as a key element in the market, also in the future" he said.
As such, "in the light of lower domestic demand for coal in the US due to the excess production of cheap gas, BIMCO expects US coal producers to become a mainstay in the Atlantic market. Down the road, we may also see coal exports from US West Coast ports.
Going forward, EIA expect US coal exports to remain elevated in 2014 too. Driven by the increased consumption of gas within the US at the expense of coal, producers opt for exporting to Europe and Asia. However, productions costs in the US require relatively high sales prices, and with coal being abundant, particularly in the Asian region, the potential seems to be capped for the near-term future. Despite slower Chinese GDP growth in 2014, commodity imports could very well stay strong. This is due to the factors of diversity in suppliers, lower commodity prices, and the lower quality of domestically produced iron ore and thermal coal", the report concluded.
Source: Nikos Roussanoglou, Hellenic Shipping
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Monday, 27 January 14
Q3 2014 SUB-BIT INDONESIA COAL SWAP LOST GROUND, ENDS AT $60 PMT
COALspot.com – Sub-Bit Indonesia coal swap (FOB) for average Q1’ 14 delivery lost 2.29% pmt month on month on Friday 24 January 2014. Th ...
Sunday, 26 January 14
FREIGHT RATES FALL FURTHER ON LACK OF CARGOES - SOLYM CARRIERS
COALspot.com: The freight market has continued to soften further this week with BDI down by 12.31 pct. BDI was closed at 1,246 points week ended 24 ...
Friday, 24 January 14
US COAL PRODUCTION UP 3.9% ON WEEK IN WEEK ENDED SATURDAY - EIA
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.1 million short tons (mmst) of coal in ...
Friday, 24 January 14
DRY BULK MARKET STRUGGLING TO FIND FIRM FOOTING IN START OF 2014 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has been faltering since the start of 2014, struggling to hold its ground as low seasonal demand has hindered further growth in ...
Thursday, 23 January 14
PANAMAX : THIS WEEK THE ACTIVITY CAME DOWN DRAMATICALLY - FEARNRESEARCH
Handy
With the Chinese New Year approaching the activity and rate levels are sliding in both hemispheres. Rates in the Atlantic have knocked off so ...
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- Essar Steel Hazira Ltd - India
- Therma Luzon, Inc, Philippines
- Power Finance Corporation Ltd., India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhoruka Overseas - Indonesia
- Sarangani Energy Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Australian Commodity Traders Exchange
- GAC Shipping (India) Pvt Ltd
- Minerals Council of Australia
- Energy Development Corp, Philippines
- Barasentosa Lestari - Indonesia
- Global Business Power Corporation, Philippines
- Medco Energi Mining Internasional
- Pendopo Energi Batubara - Indonesia
- Antam Resourcindo - Indonesia
- ICICI Bank Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Chettinad Cement Corporation Ltd - India
- IEA Clean Coal Centre - UK
- Manunggal Multi Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Global Coal Blending Company Limited - Australia
- Sojitz Corporation - Japan
- Mjunction Services Limited - India
- Indika Energy - Indonesia
- Borneo Indobara - Indonesia
- Attock Cement Pakistan Limited
- South Luzon Thermal Energy Corporation
- Kepco SPC Power Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Bangladesh Power Developement Board
- Indonesian Coal Mining Association
- Thiess Contractors Indonesia
- Billiton Holdings Pty Ltd - Australia
- Electricity Generating Authority of Thailand
- Carbofer General Trading SA - India
- Kapuas Tunggal Persada - Indonesia
- White Energy Company Limited
- Cement Manufacturers Association - India
- GMR Energy Limited - India
- Parliament of New Zealand
- Parry Sugars Refinery, India
- Goldman Sachs - Singapore
- Mintek Dendrill Indonesia
- GVK Power & Infra Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement - Thailand
- Malabar Cements Ltd - India
- Indian Energy Exchange, India
- Riau Bara Harum - Indonesia
- Petron Corporation, Philippines
- Merrill Lynch Commodities Europe
- European Bulk Services B.V. - Netherlands
- CIMB Investment Bank - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Energy Link Ltd, New Zealand
- Baramulti Group, Indonesia
- Standard Chartered Bank - UAE
- Maheswari Brothers Coal Limited - India
- Planning Commission, India
- Metalloyd Limited - United Kingdom
- IHS Mccloskey Coal Group - USA
- Iligan Light & Power Inc, Philippines
- Bhushan Steel Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Electricity Authority, New Zealand
- Leighton Contractors Pty Ltd - Australia
- Jaiprakash Power Ventures ltd
- Economic Council, Georgia
- Cigading International Bulk Terminal - Indonesia
- Anglo American - United Kingdom
- Tata Chemicals Ltd - India
- Larsen & Toubro Limited - India
- Ministry of Mines - Canada
- Oldendorff Carriers - Singapore
- Toyota Tsusho Corporation, Japan
- Heidelberg Cement - Germany
- Kartika Selabumi Mining - Indonesia
- Ind-Barath Power Infra Limited - India
- Dalmia Cement Bharat India
- Kideco Jaya Agung - Indonesia
- New Zealand Coal & Carbon
- The State Trading Corporation of India Ltd
- Ambuja Cements Ltd - India
- Georgia Ports Authority, United States
- Bharathi Cement Corporation - India
- PowerSource Philippines DevCo
- Orica Australia Pty. Ltd.
- Central Java Power - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Kumho Petrochemical, South Korea
- Sree Jayajothi Cements Limited - India
- SMG Consultants - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Chamber of Mines of South Africa
- Gujarat Electricity Regulatory Commission - India
- The Treasury - Australian Government
- Posco Energy - South Korea
- Savvy Resources Ltd - HongKong
- Straits Asia Resources Limited - Singapore
- Eastern Coal Council - USA
- Ceylon Electricity Board - Sri Lanka
- OPG Power Generation Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Samtan Co., Ltd - South Korea
- International Coal Ventures Pvt Ltd - India
- Romanian Commodities Exchange
- Price Waterhouse Coopers - Russia
- Petrochimia International Co. Ltd.- Taiwan
- Jorong Barutama Greston.PT - Indonesia
- Binh Thuan Hamico - Vietnam
- GN Power Mariveles Coal Plant, Philippines
- Sical Logistics Limited - India
- Bayan Resources Tbk. - Indonesia
- Port Waratah Coal Services - Australia
- Meralco Power Generation, Philippines
- TeaM Sual Corporation - Philippines
- MS Steel International - UAE
- Trasteel International SA, Italy
- Bulk Trading Sa - Switzerland
- Africa Commodities Group - South Africa
- Karbindo Abesyapradhi - Indoneisa
- Marubeni Corporation - India
- ASAPP Information Group - India
- Lanco Infratech Ltd - India
- Gujarat Sidhee Cement - India
- Bukit Asam (Persero) Tbk - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Coalindo Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Grasim Industreis Ltd - India
- Timah Investasi Mineral - Indoneisa
- Eastern Energy - Thailand
- Bhatia International Limited - India
- Global Green Power PLC Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Vedanta Resources Plc - India
- Kaltim Prima Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- Semirara Mining and Power Corporation, Philippines
- Singapore Mercantile Exchange
- The University of Queensland
- Sinarmas Energy and Mining - Indonesia
- Globalindo Alam Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- PNOC Exploration Corporation - Philippines
- Edison Trading Spa - Italy
- Australian Coal Association
- Independent Power Producers Association of India
- Alfred C Toepfer International GmbH - Germany
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sakthi Sugars Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Indogreen Group - Indonesia
- Videocon Industries ltd - India
- Vizag Seaport Private Limited - India
- Wood Mackenzie - Singapore
- Thai Mozambique Logistica
- Sindya Power Generating Company Private Ltd
- Latin American Coal - Colombia
- Xindia Steels Limited - India
- Meenaskhi Energy Private Limited - India
- Makarim & Taira - Indonesia
- Interocean Group of Companies - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- London Commodity Brokers - England
- VISA Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Coastal Gujarat Power Limited - India
- Karaikal Port Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Semirara Mining Corp, Philippines
- Wilmar Investment Holdings
- CNBM International Corporation - China
- Indo Tambangraya Megah - Indonesia
- San Jose City I Power Corp, Philippines
- Star Paper Mills Limited - India
- LBH Netherlands Bv - Netherlands
- Siam City Cement PLC, Thailand
- Directorate Of Revenue Intelligence - India
- Mercuria Energy - Indonesia
- Tamil Nadu electricity Board
- Bukit Baiduri Energy - Indonesia
- Coal and Oil Company - UAE
- Deloitte Consulting - India
- PTC India Limited - India
- Banpu Public Company Limited - Thailand
- Formosa Plastics Group - Taiwan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- India Bulls Power Limited - India
- Aditya Birla Group - India
- Ministry of Finance - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Commonwealth Bank - Australia
- Central Electricity Authority - India
- Orica Mining Services - Indonesia
- Rio Tinto Coal - Australia
- Madhucon Powers Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- SMC Global Power, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Makmur.PT - Indonesia
- Simpson Spence & Young - Indonesia
- Ministry of Transport, Egypt
- Altura Mining Limited, Indonesia
- Kobexindo Tractors - Indoneisa
- Indian Oil Corporation Limited
- McConnell Dowell - Australia
- Renaissance Capital - South Africa
- Agrawal Coal Company - India
- Mercator Lines Limited - India
- Kalimantan Lumbung Energi - Indonesia
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