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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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Friday, 17 January 14
DRY BULK MARKET ENDS DECLINE, BOUNCES BACK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
It's been a rough start to the New Year for the dry bulk market, which was supposed to be on the verge of rallying to new heights this year, on the ...
Friday, 17 January 14
SPOT COAL PRICE TRENDS IN US VARY ACROSS KEY BASINS DURING 2013, SAYS EIA
COALspot.com: Spot steam coal price trends in US varied across key basins in 2013, a latest EIA report says. Compared with 2012, while total coal de ...
Thursday, 16 January 14
PANAMAX : THE GAP BETWEEN SPOT AND PERIOD HAS INCREASED IN BOTH HEMISPHERES - FEARNRESEARCH
Handy
In the Atlantic we have seen rates slowly sliding on lack of enough fresh business. USG/Continent still paying excess 28k and seems on an upw ...
Thursday, 16 January 14
SHIP OWNERS SCRAP 1,119 SHIPS DURING 2013 ON THE BACK OF OVERSUPPLY ISSUES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Scrapping of older vessels is still the best bet that ship owners can make, in order to improve their newer vessels' fortunes, amid an oversupply o ...
Wednesday, 15 January 14
KOREA MIDLAND POWER CO INVITES BIDS FOR 360K MT OF SUB-BITUMINOUS COAL FOR ITS BORYEONG PLANT
COALspot.com : Korea Midland Power Co., Ltd. has invited bids through International open bidding for 360,000 Metric Tons (MT) of sub-bituminous ...
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- Iligan Light & Power Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Energy Development Corp, Philippines
- Indogreen Group - Indonesia
- Gujarat Electricity Regulatory Commission - India
- San Jose City I Power Corp, Philippines
- Bulk Trading Sa - Switzerland
- International Coal Ventures Pvt Ltd - India
- Makarim & Taira - Indonesia
- Bukit Baiduri Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Carbofer General Trading SA - India
- Port Waratah Coal Services - Australia
- SMC Global Power, Philippines
- Asmin Koalindo Tuhup - Indonesia
- VISA Power Limited - India
- Indian Oil Corporation Limited
- Lanco Infratech Ltd - India
- Sojitz Corporation - Japan
- Ind-Barath Power Infra Limited - India
- Latin American Coal - Colombia
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- Heidelberg Cement - Germany
- CNBM International Corporation - China
- Meenaskhi Energy Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Commonwealth Bank - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bhushan Steel Limited - India
- Ministry of Transport, Egypt
- Mercuria Energy - Indonesia
- Electricity Authority, New Zealand
- The Treasury - Australian Government
- Mjunction Services Limited - India
- MS Steel International - UAE
- Ministry of Finance - Indonesia
- AsiaOL BioFuels Corp., Philippines
- European Bulk Services B.V. - Netherlands
- Grasim Industreis Ltd - India
- Coalindo Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Xindia Steels Limited - India
- Kumho Petrochemical, South Korea
- Aboitiz Power Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Renaissance Capital - South Africa
- Bukit Makmur.PT - Indonesia
- Jindal Steel & Power Ltd - India
- Therma Luzon, Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Manunggal Multi Energi - Indonesia
- The State Trading Corporation of India Ltd
- Marubeni Corporation - India
- London Commodity Brokers - England
- Toyota Tsusho Corporation, Japan
- Gujarat Mineral Development Corp Ltd - India
- Sical Logistics Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Eastern Coal Council - USA
- India Bulls Power Limited - India
- South Luzon Thermal Energy Corporation
- Cement Manufacturers Association - India
- PNOC Exploration Corporation - Philippines
- Romanian Commodities Exchange
- New Zealand Coal & Carbon
- McConnell Dowell - Australia
- TeaM Sual Corporation - Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Meralco Power Generation, Philippines
- Riau Bara Harum - Indonesia
- Deloitte Consulting - India
- Global Coal Blending Company Limited - Australia
- Indian Energy Exchange, India
- Edison Trading Spa - Italy
- Karaikal Port Pvt Ltd - India
- Thiess Contractors Indonesia
- Bayan Resources Tbk. - Indonesia
- Global Green Power PLC Corporation, Philippines
- Madhucon Powers Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- ASAPP Information Group - India
- Standard Chartered Bank - UAE
- IHS Mccloskey Coal Group - USA
- Siam City Cement PLC, Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Price Waterhouse Coopers - Russia
- Trasteel International SA, Italy
- Orica Mining Services - Indonesia
- Sree Jayajothi Cements Limited - India
- Planning Commission, India
- Kobexindo Tractors - Indoneisa
- Minerals Council of Australia
- Jorong Barutama Greston.PT - Indonesia
- Siam City Cement - Thailand
- Attock Cement Pakistan Limited
- Holcim Trading Pte Ltd - Singapore
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- Neyveli Lignite Corporation Ltd, - India
- Aditya Birla Group - India
- Tata Chemicals Ltd - India
- Savvy Resources Ltd - HongKong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PowerSource Philippines DevCo
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bangladesh Power Developement Board
- Posco Energy - South Korea
- Medco Energi Mining Internasional
- Samtan Co., Ltd - South Korea
- Goldman Sachs - Singapore
- Wood Mackenzie - Singapore
- GMR Energy Limited - India
- Bharathi Cement Corporation - India
- Kaltim Prima Coal - Indonesia
- ICICI Bank Limited - India
- Wilmar Investment Holdings
- Sakthi Sugars Limited - India
- Videocon Industries ltd - India
- Agrawal Coal Company - India
- GAC Shipping (India) Pvt Ltd
- Alfred C Toepfer International GmbH - Germany
- TNB Fuel Sdn Bhd - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- Vizag Seaport Private Limited - India
- Star Paper Mills Limited - India
- Sinarmas Energy and Mining - Indonesia
- Africa Commodities Group - South Africa
- Salva Resources Pvt Ltd - India
- GVK Power & Infra Limited - India
- Vedanta Resources Plc - India
- Mintek Dendrill Indonesia
- Australian Coal Association
- Globalindo Alam Lestari - Indonesia
- Eastern Energy - Thailand
- Formosa Plastics Group - Taiwan
- Kalimantan Lumbung Energi - Indonesia
- Leighton Contractors Pty Ltd - Australia
- IEA Clean Coal Centre - UK
- Essar Steel Hazira Ltd - India
- SMG Consultants - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Georgia Ports Authority, United States
- Semirara Mining and Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Sindya Power Generating Company Private Ltd
- Anglo American - United Kingdom
- Kideco Jaya Agung - Indonesia
- Directorate Of Revenue Intelligence - India
- Ministry of Mines - Canada
- Mercator Lines Limited - India
- Energy Link Ltd, New Zealand
- Pendopo Energi Batubara - Indonesia
- CIMB Investment Bank - Malaysia
- Oldendorff Carriers - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Indo Tambangraya Megah - Indonesia
- Banpu Public Company Limited - Thailand
- Interocean Group of Companies - India
- Jaiprakash Power Ventures ltd
- White Energy Company Limited
- Intertek Mineral Services - Indonesia
- The University of Queensland
- Singapore Mercantile Exchange
- Electricity Generating Authority of Thailand
- Binh Thuan Hamico - Vietnam
- OPG Power Generation Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Maheswari Brothers Coal Limited - India
- Petron Corporation, Philippines
- Gujarat Sidhee Cement - India
- Baramulti Group, Indonesia
- Malabar Cements Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Global Business Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Borneo Indobara - Indonesia
- PTC India Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Chamber of Mines of South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Tamil Nadu electricity Board
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- Semirara Mining Corp, Philippines
- Antam Resourcindo - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Electricity Authority - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Straits Asia Resources Limited - Singapore
- Rio Tinto Coal - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Commodity Traders Exchange
- Timah Investasi Mineral - Indoneisa
- Indonesian Coal Mining Association
- Power Finance Corporation Ltd., India
- Barasentosa Lestari - Indonesia
- Thai Mozambique Logistica
- Krishnapatnam Port Company Ltd. - India
- Miang Besar Coal Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Coal and Oil Company - UAE
- Central Java Power - Indonesia
- Metalloyd Limited - United Kingdom
- Cigading International Bulk Terminal - Indonesia
- Bhatia International Limited - India
- Dalmia Cement Bharat India
- Parry Sugars Refinery, India
- Altura Mining Limited, Indonesia
- Indika Energy - Indonesia
- LBH Netherlands Bv - Netherlands
- Economic Council, Georgia
- Parliament of New Zealand
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