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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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Thursday, 20 February 14
LENGTHY DELAYS TO PANAMA CANAL EXPANSION POSE GLOBAL TRADE RISKS; US COAL PRODUCERS TO GREATLY BENEFIT ONCE COMPLETE, SAYS WOOD MACKENZIE
Wood Mackenzie expects the recent cost overrun disputes around the Panama Canal expansion to be resolved with limited disruption due to the signific ...
Thursday, 20 February 14
SUPRAMAX: IN ASIA IS IMPROVING SIGNIFICANTLY AND TURNED FROM APS TO DOP MARKET
Handy
The activity is back in the market after Chinese holidays. Supramax in Asia is improving significantly and turned from APS to DOP market. We ...
Wednesday, 19 February 14
NEWCASTLE PORT SHIPPED 30% MORE COAL WEEK ON WEEK
COALspot.com: In the week ended 17 February 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, totalled ...
Tuesday, 18 February 14
PERUVIAN HIGH COMMISSIONER FOR MINING AFFAIRS WILL BE KEY NOTE SPEAKER AT THE COLOMBIAN COAL CONFERENCE 2014
Press Release: The High Commissioner for Mining Affairs in the Presidency of the Peruvian Council of Ministers, General (R) Daniel Urresti Elera, ha ...
Monday, 17 February 14
US COAL PRODUCTION IN 2013 FELL TO ITS LOWEST LEVEL IN 20 YEARS
COALspot.com: U.S coal production for 2013 totaled an estimated 996 million short tons (MMst), 21 MMst (2%) lower than in 2012. It is the first time ...
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- Alfred C Toepfer International GmbH - Germany
- Sical Logistics Limited - India
- LBH Netherlands Bv - Netherlands
- TNB Fuel Sdn Bhd - Malaysia
- PetroVietnam Power Coal Import and Supply Company
- Orica Mining Services - Indonesia
- Videocon Industries ltd - India
- Ministry of Finance - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Edison Trading Spa - Italy
- Bukit Makmur.PT - Indonesia
- Vizag Seaport Private Limited - India
- Latin American Coal - Colombia
- Baramulti Group, Indonesia
- Manunggal Multi Energi - Indonesia
- Jindal Steel & Power Ltd - India
- Xindia Steels Limited - India
- Marubeni Corporation - India
- Sree Jayajothi Cements Limited - India
- International Coal Ventures Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- MS Steel International - UAE
- European Bulk Services B.V. - Netherlands
- The University of Queensland
- Bhatia International Limited - India
- Agrawal Coal Company - India
- SN Aboitiz Power Inc, Philippines
- Rio Tinto Coal - Australia
- McConnell Dowell - Australia
- Attock Cement Pakistan Limited
- Sinarmas Energy and Mining - Indonesia
- Ministry of Mines - Canada
- Jorong Barutama Greston.PT - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Trasteel International SA, Italy
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Chettinad Cement Corporation Ltd - India
- Globalindo Alam Lestari - Indonesia
- Formosa Plastics Group - Taiwan
- Kepco SPC Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement - Thailand
- Binh Thuan Hamico - Vietnam
- Orica Australia Pty. Ltd.
- The Treasury - Australian Government
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Power Finance Corporation Ltd., India
- Aditya Birla Group - India
- IEA Clean Coal Centre - UK
- Energy Link Ltd, New Zealand
- PTC India Limited - India
- Goldman Sachs - Singapore
- Ministry of Transport, Egypt
- Cement Manufacturers Association - India
- GN Power Mariveles Coal Plant, Philippines
- Vedanta Resources Plc - India
- TeaM Sual Corporation - Philippines
- Carbofer General Trading SA - India
- Bhushan Steel Limited - India
- Malabar Cements Ltd - India
- Global Green Power PLC Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Romanian Commodities Exchange
- CNBM International Corporation - China
- Ind-Barath Power Infra Limited - India
- ICICI Bank Limited - India
- Anglo American - United Kingdom
- Aboitiz Power Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Borneo Indobara - Indonesia
- Minerals Council of Australia
- Star Paper Mills Limited - India
- Sindya Power Generating Company Private Ltd
- Metalloyd Limited - United Kingdom
- Leighton Contractors Pty Ltd - Australia
- Mercator Lines Limited - India
- Riau Bara Harum - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Coalindo Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Global Coal Blending Company Limited - Australia
- Indian Oil Corporation Limited
- Thai Mozambique Logistica
- Asmin Koalindo Tuhup - Indonesia
- Directorate Of Revenue Intelligence - India
- Sakthi Sugars Limited - India
- Salva Resources Pvt Ltd - India
- Merrill Lynch Commodities Europe
- SMC Global Power, Philippines
- Energy Development Corp, Philippines
- Heidelberg Cement - Germany
- Electricity Generating Authority of Thailand
- Chamber of Mines of South Africa
- Oldendorff Carriers - Singapore
- Coastal Gujarat Power Limited - India
- Wilmar Investment Holdings
- Thiess Contractors Indonesia
- VISA Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Dalmia Cement Bharat India
- Karaikal Port Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMG Consultants - Indonesia
- Makarim & Taira - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Global Business Power Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Iligan Light & Power Inc, Philippines
- CIMB Investment Bank - Malaysia
- Semirara Mining Corp, Philippines
- Simpson Spence & Young - Indonesia
- Toyota Tsusho Corporation, Japan
- London Commodity Brokers - England
- GVK Power & Infra Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Standard Chartered Bank - UAE
- Tamil Nadu electricity Board
- San Jose City I Power Corp, Philippines
- Africa Commodities Group - South Africa
- Parry Sugars Refinery, India
- Mintek Dendrill Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Australian Commodity Traders Exchange
- Medco Energi Mining Internasional
- PowerSource Philippines DevCo
- Gujarat Sidhee Cement - India
- IHS Mccloskey Coal Group - USA
- GMR Energy Limited - India
- Essar Steel Hazira Ltd - India
- South Luzon Thermal Energy Corporation
- Cigading International Bulk Terminal - Indonesia
- Kobexindo Tractors - Indoneisa
- Tata Chemicals Ltd - India
- Siam City Cement PLC, Thailand
- Banpu Public Company Limited - Thailand
- Kohat Cement Company Ltd. - Pakistan
- Eastern Coal Council - USA
- Holcim Trading Pte Ltd - Singapore
- India Bulls Power Limited - India
- Bangladesh Power Developement Board
- Posco Energy - South Korea
- OPG Power Generation Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Intertek Mineral Services - Indonesia
- Electricity Authority, New Zealand
- Bayan Resources Tbk. - Indonesia
- Meralco Power Generation, Philippines
- Singapore Mercantile Exchange
- Barasentosa Lestari - Indonesia
- Central Electricity Authority - India
- Samtan Co., Ltd - South Korea
- Petron Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Uttam Galva Steels Limited - India
- Indogreen Group - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Deloitte Consulting - India
- Sojitz Corporation - Japan
- White Energy Company Limited
- Maharashtra Electricity Regulatory Commission - India
- Eastern Energy - Thailand
- Bukit Baiduri Energy - Indonesia
- Australian Coal Association
- Coal and Oil Company - UAE
- Kumho Petrochemical, South Korea
- Sarangani Energy Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indonesian Coal Mining Association
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- New Zealand Coal & Carbon
- Antam Resourcindo - Indonesia
- Renaissance Capital - South Africa
- Bharathi Cement Corporation - India
- Mercuria Energy - Indonesia
- Timah Investasi Mineral - Indoneisa
- Altura Mining Limited, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Economic Council, Georgia
- Ambuja Cements Ltd - India
- Interocean Group of Companies - India
- Neyveli Lignite Corporation Ltd, - India
- Central Java Power - Indonesia
- ASAPP Information Group - India
- Bhoruka Overseas - Indonesia
- Pendopo Energi Batubara - Indonesia
- Georgia Ports Authority, United States
- Larsen & Toubro Limited - India
- Bulk Trading Sa - Switzerland
- Indika Energy - Indonesia
- Indian Energy Exchange, India
- Savvy Resources Ltd - HongKong
- Indo Tambangraya Megah - Indonesia
- Parliament of New Zealand
- Price Waterhouse Coopers - Russia
- Wood Mackenzie - Singapore
- Jaiprakash Power Ventures ltd
- Grasim Industreis Ltd - India
- Kaltim Prima Coal - Indonesia
- Commonwealth Bank - Australia
- Straits Asia Resources Limited - Singapore
- PNOC Exploration Corporation - Philippines
- Independent Power Producers Association of India
- Rashtriya Ispat Nigam Limited - India
- Therma Luzon, Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
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