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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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Friday, 07 March 14
INDONESIA TO PRODUCE 421 MMT OF COAL IN 2014
Coalspot.com: Indonesia finally agreed to increased 2014 coal output by as much as 6 percent to 421 million metric tons from its previous plan, a se ...
Friday, 07 March 14
US PRODUCED 19.4 MMST OF COAL IN PAST 7 DAYS, SAYS EIA
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.4 million short tons (mmst) of coal in ...
Thursday, 06 March 14
PANAMAX MARKET IS STRUGGLING IN BOTH HEMISPHERES - FEARNRESEARCH
Handy
The Handy/Supra market experienced a rate increase in the Pacific. The activity itself is not too big, but spot tonnage is clearing up and ow ...
Wednesday, 05 March 14
THE BIG BULKERS HAVE IN FACT WITNESSED SIGNIFICANT IMPROVEMENTS IN BOTH BASINS
The BDI continues to gain back some of the lost ground, although in reality there isn't a lot to celebrate abou ...
Wednesday, 05 March 14
LEAVE IT TO CAPES TO CHANGE THE DIRECTION OF THE DRY BULK MARKET - INTERMODAL
Chartering (Wet: Stable- / Dry: Stable+)
Leave it to Capes to change the direction of the Dry Bulk market. The big bulkers managed to drag the BDI ...
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- Uttam Galva Steels Limited - India
- Electricity Authority, New Zealand
- Manunggal Multi Energi - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Xindia Steels Limited - India
- McConnell Dowell - Australia
- PNOC Exploration Corporation - Philippines
- GMR Energy Limited - India
- Salva Resources Pvt Ltd - India
- Madhucon Powers Ltd - India
- Ministry of Mines - Canada
- India Bulls Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Siam City Cement - Thailand
- ICICI Bank Limited - India
- Central Java Power - Indonesia
- Thiess Contractors Indonesia
- Thai Mozambique Logistica
- Kepco SPC Power Corporation, Philippines
- Bhushan Steel Limited - India
- Posco Energy - South Korea
- Vedanta Resources Plc - India
- Bukit Asam (Persero) Tbk - Indonesia
- Meralco Power Generation, Philippines
- Wilmar Investment Holdings
- IEA Clean Coal Centre - UK
- Asmin Koalindo Tuhup - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- European Bulk Services B.V. - Netherlands
- Global Coal Blending Company Limited - Australia
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Mjunction Services Limited - India
- London Commodity Brokers - England
- The State Trading Corporation of India Ltd
- Intertek Mineral Services - Indonesia
- South Luzon Thermal Energy Corporation
- Sical Logistics Limited - India
- Indika Energy - Indonesia
- The Treasury - Australian Government
- GAC Shipping (India) Pvt Ltd
- Kalimantan Lumbung Energi - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Eastern Coal Council - USA
- Price Waterhouse Coopers - Russia
- Parry Sugars Refinery, India
- IHS Mccloskey Coal Group - USA
- Central Electricity Authority - India
- Therma Luzon, Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Indian Oil Corporation Limited
- Essar Steel Hazira Ltd - India
- Coal and Oil Company - UAE
- Kartika Selabumi Mining - Indonesia
- Samtan Co., Ltd - South Korea
- Bayan Resources Tbk. - Indonesia
- VISA Power Limited - India
- Dalmia Cement Bharat India
- Eastern Energy - Thailand
- New Zealand Coal & Carbon
- Ministry of Finance - Indonesia
- Ambuja Cements Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Indo Tambangraya Megah - Indonesia
- Rio Tinto Coal - Australia
- Makarim & Taira - Indonesia
- Baramulti Group, Indonesia
- AsiaOL BioFuels Corp., Philippines
- Anglo American - United Kingdom
- Directorate Of Revenue Intelligence - India
- Larsen & Toubro Limited - India
- Electricity Generating Authority of Thailand
- GN Power Mariveles Coal Plant, Philippines
- Orica Australia Pty. Ltd.
- Carbofer General Trading SA - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- OPG Power Generation Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Aboitiz Power Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Indonesian Coal Mining Association
- Gujarat Sidhee Cement - India
- Petrochimia International Co. Ltd.- Taiwan
- Ministry of Transport, Egypt
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sindya Power Generating Company Private Ltd
- Lanco Infratech Ltd - India
- Bulk Trading Sa - Switzerland
- The University of Queensland
- Energy Link Ltd, New Zealand
- Petron Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Kideco Jaya Agung - Indonesia
- Kaltim Prima Coal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Independent Power Producers Association of India
- Singapore Mercantile Exchange
- Latin American Coal - Colombia
- Chettinad Cement Corporation Ltd - India
- Medco Energi Mining Internasional
- Vijayanagar Sugar Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Global Business Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- Port Waratah Coal Services - Australia
- SN Aboitiz Power Inc, Philippines
- Jindal Steel & Power Ltd - India
- Economic Council, Georgia
- Oldendorff Carriers - Singapore
- Ceylon Electricity Board - Sri Lanka
- Cement Manufacturers Association - India
- Grasim Industreis Ltd - India
- SMG Consultants - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Banpu Public Company Limited - Thailand
- Aditya Birla Group - India
- Videocon Industries ltd - India
- Sree Jayajothi Cements Limited - India
- Ind-Barath Power Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- Agrawal Coal Company - India
- Bukit Baiduri Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- Cigading International Bulk Terminal - Indonesia
- TeaM Sual Corporation - Philippines
- Altura Mining Limited, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- PTC India Limited - India
- Kapuas Tunggal Persada - Indonesia
- Maheswari Brothers Coal Limited - India
- GVK Power & Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- CNBM International Corporation - China
- Formosa Plastics Group - Taiwan
- Mintek Dendrill Indonesia
- Jaiprakash Power Ventures ltd
- Alfred C Toepfer International GmbH - Germany
- Commonwealth Bank - Australia
- Tamil Nadu electricity Board
- Borneo Indobara - Indonesia
- Vizag Seaport Private Limited - India
- Goldman Sachs - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- Karaikal Port Pvt Ltd - India
- PowerSource Philippines DevCo
- Indogreen Group - Indonesia
- Renaissance Capital - South Africa
- Mercator Lines Limited - India
- Marubeni Corporation - India
- Parliament of New Zealand
- Edison Trading Spa - Italy
- Tata Chemicals Ltd - India
- Georgia Ports Authority, United States
- Planning Commission, India
- Sojitz Corporation - Japan
- Malabar Cements Ltd - India
- Trasteel International SA, Italy
- Bharathi Cement Corporation - India
- Miang Besar Coal Terminal - Indonesia
- Straits Asia Resources Limited - Singapore
- Star Paper Mills Limited - India
- Meenaskhi Energy Private Limited - India
- White Energy Company Limited
- Wood Mackenzie - Singapore
- San Jose City I Power Corp, Philippines
- Romanian Commodities Exchange
- Barasentosa Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Krishnapatnam Port Company Ltd. - India
- Bukit Makmur.PT - Indonesia
- Energy Development Corp, Philippines
- Power Finance Corporation Ltd., India
- Africa Commodities Group - South Africa
- Pendopo Energi Batubara - Indonesia
- Australian Commodity Traders Exchange
- ASAPP Information Group - India
- International Coal Ventures Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Attock Cement Pakistan Limited
- Coalindo Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Savvy Resources Ltd - HongKong
- SMC Global Power, Philippines
- Rashtriya Ispat Nigam Limited - India
- Deloitte Consulting - India
- Australian Coal Association
- Pipit Mutiara Jaya. PT, Indonesia
- Heidelberg Cement - Germany
- Globalindo Alam Lestari - Indonesia
- Indian Energy Exchange, India
- Bhatia International Limited - India
- Iligan Light & Power Inc, Philippines
- Global Green Power PLC Corporation, Philippines
- Siam City Cement PLC, Thailand
- Minerals Council of Australia
- Orica Mining Services - Indonesia
- Kumho Petrochemical, South Korea
- Semirara Mining Corp, Philippines
- Merrill Lynch Commodities Europe
- Chamber of Mines of South Africa
- Standard Chartered Bank - UAE
- Coastal Gujarat Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Directorate General of MIneral and Coal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercuria Energy - Indonesia
- Interocean Group of Companies - India
- Jorong Barutama Greston.PT - Indonesia
- Sakthi Sugars Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
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