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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, 13 January 14
INDONESIAN ORE BAN TO HAVE LIMITED IMPACT ON CHINESE ALUMINIUM PRODUCERS, FITCH RATINGS SAYS
COALspot.com: Fitch Ratings says today that Indonesia's ban on exports of unprocessed mineral ore will have limited impact on Chinese aluminium pro ...
Sunday, 12 January 14
THE FREIGHT MARKET CONTINUE TO REMAIN WEAK NEXT WEEK - SOLYM CARRIERS
Wish You A very Happy New Year
COALspot.com: The market has dropped quite a lot as expected due to holidays and probably also the effect of ban o ...
Friday, 10 January 14
DECISION ON ORE EXPORT BAN WILL BE MADE TOMORROW: INDUSTRY MINISTER, JG SAYS
Industry Minister M.S. Hidayat dismissed reports on Thursday that the government had made a decision on the matter. “We will only make a decis ...
Friday, 10 January 14
US COAL PRODUCTION UP 5.8% ON WEEK IN WEEK ENDED SATURDAY 4 JANUARY
COALspot.com – United States the world’s second largest coal producer, produced approximately 18.8 million short tons (mmst) of coal in ...
Thursday, 09 January 14
THE INDONESIAN GOVERNMENT EASES ORE EXPORT BAN
COALspot.com: The Indonesian government has finally agreed to ease the ore-export ban just a few days before the Sunday deadline amid protests from ...
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- Thiess Contractors Indonesia
- London Commodity Brokers - England
- Anglo American - United Kingdom
- Merrill Lynch Commodities Europe
- Tamil Nadu electricity Board
- Antam Resourcindo - Indonesia
- Indogreen Group - Indonesia
- CIMB Investment Bank - Malaysia
- Petron Corporation, Philippines
- Siam City Cement - Thailand
- White Energy Company Limited
- Global Business Power Corporation, Philippines
- Independent Power Producers Association of India
- Sinarmas Energy and Mining - Indonesia
- Grasim Industreis Ltd - India
- Kobexindo Tractors - Indoneisa
- Tata Chemicals Ltd - India
- Mercator Lines Limited - India
- Timah Investasi Mineral - Indoneisa
- Makarim & Taira - Indonesia
- Central Electricity Authority - India
- Oldendorff Carriers - Singapore
- Aditya Birla Group - India
- GMR Energy Limited - India
- Bayan Resources Tbk. - Indonesia
- Bharathi Cement Corporation - India
- Wood Mackenzie - Singapore
- Singapore Mercantile Exchange
- Mintek Dendrill Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Barasentosa Lestari - Indonesia
- Renaissance Capital - South Africa
- Jorong Barutama Greston.PT - Indonesia
- Lanco Infratech Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Coastal Gujarat Power Limited - India
- Vizag Seaport Private Limited - India
- Aboitiz Power Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Pendopo Energi Batubara - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Maheswari Brothers Coal Limited - India
- SMG Consultants - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Economic Council, Georgia
- Karaikal Port Pvt Ltd - India
- Georgia Ports Authority, United States
- Semirara Mining Corp, Philippines
- Africa Commodities Group - South Africa
- Bhatia International Limited - India
- Bhushan Steel Limited - India
- Wilmar Investment Holdings
- The Treasury - Australian Government
- Orica Australia Pty. Ltd.
- Energy Link Ltd, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Borneo Indobara - Indonesia
- Therma Luzon, Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Ambuja Cements Ltd - India
- Ind-Barath Power Infra Limited - India
- Directorate General of MIneral and Coal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Deloitte Consulting - India
- Dalmia Cement Bharat India
- Carbofer General Trading SA - India
- McConnell Dowell - Australia
- Bangladesh Power Developement Board
- Vedanta Resources Plc - India
- Ministry of Mines - Canada
- Edison Trading Spa - Italy
- Indo Tambangraya Megah - Indonesia
- Essar Steel Hazira Ltd - India
- Sical Logistics Limited - India
- Gujarat Mineral Development Corp Ltd - India
- South Luzon Thermal Energy Corporation
- ASAPP Information Group - India
- Heidelberg Cement - Germany
- SN Aboitiz Power Inc, Philippines
- SMC Global Power, Philippines
- Sree Jayajothi Cements Limited - India
- GAC Shipping (India) Pvt Ltd
- Global Coal Blending Company Limited - Australia
- IEA Clean Coal Centre - UK
- Baramulti Group, Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Billiton Holdings Pty Ltd - Australia
- Kumho Petrochemical, South Korea
- Electricity Generating Authority of Thailand
- Energy Development Corp, Philippines
- Ministry of Finance - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Indian Energy Exchange, India
- PTC India Limited - India
- Intertek Mineral Services - Indonesia
- Minerals Council of Australia
- Siam City Cement PLC, Thailand
- Power Finance Corporation Ltd., India
- Salva Resources Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Sakthi Sugars Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- CNBM International Corporation - China
- Toyota Tsusho Corporation, Japan
- Samtan Co., Ltd - South Korea
- Straits Asia Resources Limited - Singapore
- Orica Mining Services - Indonesia
- Trasteel International SA, Italy
- International Coal Ventures Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Parliament of New Zealand
- San Jose City I Power Corp, Philippines
- Miang Besar Coal Terminal - Indonesia
- Cigading International Bulk Terminal - Indonesia
- India Bulls Power Limited - India
- Central Java Power - Indonesia
- New Zealand Coal & Carbon
- Jindal Steel & Power Ltd - India
- Chettinad Cement Corporation Ltd - India
- Parry Sugars Refinery, India
- Commonwealth Bank - Australia
- Eastern Energy - Thailand
- Port Waratah Coal Services - Australia
- Uttam Galva Steels Limited - India
- PowerSource Philippines DevCo
- Indian Oil Corporation Limited
- Binh Thuan Hamico - Vietnam
- Goldman Sachs - Singapore
- AsiaOL BioFuels Corp., Philippines
- Savvy Resources Ltd - HongKong
- Chamber of Mines of South Africa
- Simpson Spence & Young - Indonesia
- Gujarat Sidhee Cement - India
- Coalindo Energy - Indonesia
- Mjunction Services Limited - India
- Price Waterhouse Coopers - Russia
- Riau Bara Harum - Indonesia
- Indonesian Coal Mining Association
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kartika Selabumi Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Meralco Power Generation, Philippines
- MS Steel International - UAE
- Marubeni Corporation - India
- Australian Commodity Traders Exchange
- Ministry of Transport, Egypt
- Petrochimia International Co. Ltd.- Taiwan
- Ceylon Electricity Board - Sri Lanka
- ICICI Bank Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Planning Commission, India
- Maharashtra Electricity Regulatory Commission - India
- Australian Coal Association
- Meenaskhi Energy Private Limited - India
- Electricity Authority, New Zealand
- Romanian Commodities Exchange
- Bhoruka Overseas - Indonesia
- Bukit Makmur.PT - Indonesia
- Agrawal Coal Company - India
- Videocon Industries ltd - India
- Bukit Baiduri Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- PNOC Exploration Corporation - Philippines
- Latin American Coal - Colombia
- Kepco SPC Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Banpu Public Company Limited - Thailand
- PetroVietnam Power Coal Import and Supply Company
- The University of Queensland
- Iligan Light & Power Inc, Philippines
- Madhucon Powers Ltd - India
- Medco Energi Mining Internasional
- Kideco Jaya Agung - Indonesia
- Star Paper Mills Limited - India
- Sarangani Energy Corporation, Philippines
- Mercuria Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- Alfred C Toepfer International GmbH - Germany
- Larsen & Toubro Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Malabar Cements Ltd - India
- Attock Cement Pakistan Limited
- Jaiprakash Power Ventures ltd
- Kaltim Prima Coal - Indonesia
- Sojitz Corporation - Japan
- GN Power Mariveles Coal Plant, Philippines
- Neyveli Lignite Corporation Ltd, - India
- GVK Power & Infra Limited - India
- VISA Power Limited - India
- Standard Chartered Bank - UAE
- Eastern Coal Council - USA
- Sindya Power Generating Company Private Ltd
- LBH Netherlands Bv - Netherlands
- Cement Manufacturers Association - India
- Rashtriya Ispat Nigam Limited - India
- Coal and Oil Company - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Interocean Group of Companies - India
- Posco Energy - South Korea
- Metalloyd Limited - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Holcim Trading Pte Ltd - Singapore
- Thai Mozambique Logistica
- Leighton Contractors Pty Ltd - Australia
- Altura Mining Limited, Indonesia
- Indika Energy - Indonesia
- Xindia Steels Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- TeaM Sual Corporation - Philippines
- Rio Tinto Coal - Australia
- The State Trading Corporation of India Ltd
- Globalindo Alam Lestari - Indonesia
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