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Thursday, 13 February 14
DRY BULK MARKET FACES BETTER PROSPECTS ON THE BACK OF IMPROVING DEMAND AND SUPPLY BALANCE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has started off the New Year on the "left foot", with the strong finish of 2013 proving to be unsustainable, on the back of low seasonal demand. As a result, freight rates fell across the board, although the Handysize market is still close to a three-year high. In its latest report on the market, issued yesterday, BIMCO said that it believes that "the level of Capesize TC average rates will remain and stay around USD 4,500-10,000 per day. Panamax TC average rates will stay in the region of USD 5,000-11,000 per day. For the Supramax segment, BIMCO forecasts freight rates in the USD 7,000-11,000 per day interval, whereas Handysize rates are expected to stay strong in the region of USD 7,000-9,500 per day".
In his outlook on the market, BIMCO's Chief Shipping Analyst, Mr. Peter Sand noted that "as Q4-2013 was a massively strong quarter, the seasonal slowdown in Q1-2014 is likely to weigh a bit heavier than normally on freight rates. A drop of 8.8% in selected commodity volumes represent a clear seasonal direction in Q1, but if we look a bit further into the remaining three quarters, they all provide a solid rebound in demand. Chinese iron ore imports especially, but also the dry bulk market in general, is trailing off around the Chinese New Year season" he stated.
According to the report, "demand will be lower than in undisrupted months and thermal coal demand begins to ease as the Winter season in the northern hemisphere loses its grip. General shipping of nickel ore and bauxite will be far below normal levels because of the Indonesian ban– this in itself represents a change in demand beyond seasonality. Similar to the trend forecast in BIMCO Reflections 2014, demand will be centred on the major commodities. That trend has already affected Capesize rates in the most brutal way, as earnings have now entered into the sub-USD 10,000 per day zone; a decline of some 75% since early December".
Meanwhile, "in all the other segments volatility is more subdued, and over- and undershooting (up or down) seen to a lesser extent. At the end of January, Handysize tonnage is still earning in excess of USD 10,000 per day on a T/C average. This is a three-year high.
Q1 holds little room for upside, with most focus being on weather related disruptions in e.g. Australia to intrude on normal trading as well as regulatory issues affecting not just Indonesian exports but Columbian coal exports and Indian exports/imports in general, e.g. via export duties. As demand in volumes grew by 5.4% in 2013, the fundamental market balance only improved if slow steaming was applied more extensively. BIMCO believes that was the case, but only marginally. For 2014, an improvement in the market balance is clearly achievable. For it to materialise, owners and operators need to apply slow steaming to at least the same extent as last year. Only by managing the supply side carefully will higher earnings follow in the wake", it was noted.
Supply
In terms of supply, which is equally if not even more crucial to the long term viability of the industry, BIMCO said that "the demolition side of shipping will be amongst the “ones to watch” in 2014. As the order book keeps building up and eventually brings around more newbuild tonnage to cater for demand, owners might consider taking advantage of the strong demolition prices currently available to let go of less efficient ships.
In 2013, 22.2 million DWT was demolished, mostly in the smaller segments. This was 50% below the level of 2012 but considered a strong number, one that is unlikely to be repeated this year. The average age of a scrapped Capesize was 24, whereas the average demolished Handysize vessel was 30 years of age. Going forward, try to consider this as a potential scenario: the current stock of dry bulk shipping capacity equals 728 million DWT. All ships built in 1993 or earlier comprise just 68 million DWT, which is less than 10%. In comparison, taking out all ships beyond the average scrapping age in recent years (29 years), comprises just 20 million DWT. History tells us that is unlikely to happen, especially in a rising market. Thus, BIMCO forecasts 14 million DWT (or 1.9% of the current fleet) will be demolished in 2014. The fleet grew by 40 million DWT net in 2013, equal to 5.9%. BIMCO forecasts that 2014 holds 47 million DWT of newbuild capacity in store, which will be offset by 14 million DWT, leaving the fleet to bring supply growth of 4.5% around. Such a growth rate denotes an 11-year low. 2015 is already set for higher growth rates, so 2014 represents a short temporary dampening of the high growth of the fleet", it was mentioned.
"As regards the orderbook, the number of new Panamax orders has been extremely slim, in 2013 accounting for just 16% of the capacity ordered. This is a clear counterbalancing statement by the industry in response to the high fleet growth seen in that segment in the previous 15 months. Despite new orders for 197 Capesizes and 80 million DWT in total, the size of the dry bulk fleet today means that the orderbook-to-fleet ratio in the Capesize segment and total dry bulk fleet lands at just 20.5% and 20.7% respectively", the report concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Wednesday, 02 April 14
CHINA: ARBITRATION CLAUSES IN BILLS OF LADING UNDER CHINESE LEGAL PRACTICE - SKULD
KNOWLEDGE TO ELEVATE
Successful incorporation of a charterparty arbitration clause into the bills of lading is not a straight forward matte ...
Wednesday, 02 April 14
BPI BREAKING BELOW THE 1,000 PSYCHOLOGICAL LEVELS - INTERMODAL
Any resistance put forth by the Dry Bulk market the week prior was succumbed this time round. All indices slid and losses were noted across the ...
Tuesday, 01 April 14
NEWCASTLE PORT SHIPPED 11.95 MILLION TONS OF COAL IN MARCH 2014
COALspot.com: In the week ended 31 March 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, total 2 ...
Monday, 31 March 14
SHIPPING CONFIDENCE HITS HIGHEST LEVEL SINCE 2008 - MOORE STEPHENS
Overall confidence levels in the shipping industry rose to their highest level for almost six years in the three-month period to February 2014, ...
Monday, 31 March 14
COAL SWAP FOR Q1 2015 DELIVERY HAS CLOSED 4.76% HIGHER COMPARED Q2 14 CLOSING
COALspot.com – Indonesia, the world’s largest exporter of the thermal coal's swaps for delivery April - June 2014 gained this pa ...
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- The University of Queensland
- Energy Link Ltd, New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Romanian Commodities Exchange
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- Parliament of New Zealand
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- Siam City Cement PLC, Thailand
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- Medco Energi Mining Internasional
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- Petron Corporation, Philippines
- Merrill Lynch Commodities Europe
- Larsen & Toubro Limited - India
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- Savvy Resources Ltd - HongKong
- GAC Shipping (India) Pvt Ltd
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- Parry Sugars Refinery, India
- PowerSource Philippines DevCo
- Xindia Steels Limited - India
- The Treasury - Australian Government
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- White Energy Company Limited
- Billiton Holdings Pty Ltd - Australia
- Sical Logistics Limited - India
- New Zealand Coal & Carbon
- Coastal Gujarat Power Limited - India
- Australian Coal Association
- Georgia Ports Authority, United States
- Kideco Jaya Agung - Indonesia
- SMG Consultants - Indonesia
- Straits Asia Resources Limited - Singapore
- Sojitz Corporation - Japan
- Kapuas Tunggal Persada - Indonesia
- Bhatia International Limited - India
- Riau Bara Harum - Indonesia
- Ambuja Cements Ltd - India
- Edison Trading Spa - Italy
- CNBM International Corporation - China
- Coal and Oil Company - UAE
- Economic Council, Georgia
- Metalloyd Limited - United Kingdom
- Gujarat Mineral Development Corp Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bukit Baiduri Energy - Indonesia
- PTC India Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Samtan Co., Ltd - South Korea
- Jaiprakash Power Ventures ltd
- Indogreen Group - Indonesia
- Carbofer General Trading SA - India
- Heidelberg Cement - Germany
- Sakthi Sugars Limited - India
- Gujarat Sidhee Cement - India
- Altura Mining Limited, Indonesia
- Indonesian Coal Mining Association
- Lanco Infratech Ltd - India
- Bangladesh Power Developement Board
- SMC Global Power, Philippines
- Ministry of Transport, Egypt
- Ministry of Finance - Indonesia
- India Bulls Power Limited - India
- Agrawal Coal Company - India
- Mintek Dendrill Indonesia
- Therma Luzon, Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Karbindo Abesyapradhi - Indoneisa
- MS Steel International - UAE
- Thai Mozambique Logistica
- Orica Mining Services - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Maharashtra Electricity Regulatory Commission - India
- Orica Australia Pty. Ltd.
- Anglo American - United Kingdom
- Interocean Group of Companies - India
- Vijayanagar Sugar Pvt Ltd - India
- Aditya Birla Group - India
- GMR Energy Limited - India
- Standard Chartered Bank - UAE
- Indo Tambangraya Megah - Indonesia
- Global Business Power Corporation, Philippines
- Central Java Power - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Kumho Petrochemical, South Korea
- Bhoruka Overseas - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Binh Thuan Hamico - Vietnam
- Banpu Public Company Limited - Thailand
- Baramulti Group, Indonesia
- CIMB Investment Bank - Malaysia
- Planning Commission, India
- Holcim Trading Pte Ltd - Singapore
- Africa Commodities Group - South Africa
- Electricity Authority, New Zealand
- Electricity Generating Authority of Thailand
- Bharathi Cement Corporation - India
- Posco Energy - South Korea
- Vedanta Resources Plc - India
- TeaM Sual Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sarangani Energy Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Salva Resources Pvt Ltd - India
- Makarim & Taira - Indonesia
- European Bulk Services B.V. - Netherlands
- Alfred C Toepfer International GmbH - Germany
- Central Electricity Authority - India
- Power Finance Corporation Ltd., India
- LBH Netherlands Bv - Netherlands
- Tata Chemicals Ltd - India
- Attock Cement Pakistan Limited
- PetroVietnam Power Coal Import and Supply Company
- Globalindo Alam Lestari - Indonesia
- Bulk Trading Sa - Switzerland
- Cement Manufacturers Association - India
- Dalmia Cement Bharat India
- Goldman Sachs - Singapore
- Manunggal Multi Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Mjunction Services Limited - India
- Deloitte Consulting - India
- Formosa Plastics Group - Taiwan
- Uttam Galva Steels Limited - India
- Semirara Mining Corp, Philippines
- Barasentosa Lestari - Indonesia
- Price Waterhouse Coopers - Russia
- Meralco Power Generation, Philippines
- Indian Oil Corporation Limited
- OPG Power Generation Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Port Waratah Coal Services - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Kohat Cement Company Ltd. - Pakistan
- Star Paper Mills Limited - India
- Independent Power Producers Association of India
- Indian Energy Exchange, India
- Commonwealth Bank - Australia
- IEA Clean Coal Centre - UK
- Cigading International Bulk Terminal - Indonesia
- The State Trading Corporation of India Ltd
- Iligan Light & Power Inc, Philippines
- Renaissance Capital - South Africa
- Australian Commodity Traders Exchange
- Bhushan Steel Limited - India
- Eastern Energy - Thailand
- Madhucon Powers Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Borneo Indobara - Indonesia
- ASAPP Information Group - India
- Intertek Mineral Services - Indonesia
- ICICI Bank Limited - India
- Singapore Mercantile Exchange
- Trasteel International SA, Italy
- International Coal Ventures Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Ministry of Mines - Canada
- Mercator Lines Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bayan Resources Tbk. - Indonesia
- Malabar Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Ind-Barath Power Infra Limited - India
- Minerals Council of Australia
- Miang Besar Coal Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- McConnell Dowell - Australia
- San Jose City I Power Corp, Philippines
- Eastern Coal Council - USA
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- AsiaOL BioFuels Corp., Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Chamber of Mines of South Africa
- Mercuria Energy - Indonesia
- Rio Tinto Coal - Australia
- PNOC Exploration Corporation - Philippines
- Directorate Of Revenue Intelligence - India
- Videocon Industries ltd - India
- Simpson Spence & Young - Indonesia
- Kobexindo Tractors - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Timah Investasi Mineral - Indoneisa
- VISA Power Limited - India
- SN Aboitiz Power Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Bukit Makmur.PT - Indonesia
- IHS Mccloskey Coal Group - USA
- GVK Power & Infra Limited - India
- Wilmar Investment Holdings
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