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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, 13 December 13
DRY BULK SHIPPING TO WITNESS HEALTHY DEMAND MOVING FORWARD - ICS
The Institute of Chartered Shipbrokers Greek Branch organised its 9th Annual Forum at Eugenides Foundation, on Wednesday, 11th of December, with a r ...
Friday, 13 December 13
US PRODUCED APPROXIMATELY 18.4 MILLION SHORT TONS OF COAL W/E 7 DECEMBER 2013
COALspot.com – United States the world’s second largest coal producer, produced approximately 18.4 million short tons (mmst) of coal in ...
Thursday, 12 December 13
GREAT EXPECTATIONS SANCTIONED - EVA TZIMA
News that sanctions on Iranian oil exports could be lifted sometime in the following months have shaken the markets recently. One of the world&rsquo ...
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 pre ...
Wednesday, 11 December 13
THE INDONESIAN GOVERNMENT IS CONSIDERING SETTING A REGULATION ON THE MINIMUM PURITY TO REGULATE UNPROCESSED ORE BAN
COALspot.com: Energy and Mineral Resources Minister Jero Wacik recently proposed to house those mining (mineral) companies that had shown a commitme ...
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- GAC Shipping (India) Pvt Ltd
- Coastal Gujarat Power Limited - India
- Madhucon Powers Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- SN Aboitiz Power Inc, Philippines
- PowerSource Philippines DevCo
- Central Electricity Authority - India
- Eastern Energy - Thailand
- Videocon Industries ltd - India
- Latin American Coal - Colombia
- Vizag Seaport Private Limited - India
- Pendopo Energi Batubara - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Thai Mozambique Logistica
- Dalmia Cement Bharat India
- Oldendorff Carriers - Singapore
- Indogreen Group - Indonesia
- Simpson Spence & Young - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Coal Blending Company Limited - Australia
- Economic Council, Georgia
- Holcim Trading Pte Ltd - Singapore
- Australian Coal Association
- Sakthi Sugars Limited - India
- Romanian Commodities Exchange
- Energy Development Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Transport, Egypt
- Vedanta Resources Plc - India
- Bukit Asam (Persero) Tbk - Indonesia
- Riau Bara Harum - Indonesia
- Sindya Power Generating Company Private Ltd
- MS Steel International - UAE
- Cement Manufacturers Association - India
- Mercator Lines Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Timah Investasi Mineral - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Bhushan Steel Limited - India
- Jindal Steel & Power Ltd - India
- ASAPP Information Group - India
- The Treasury - Australian Government
- Kalimantan Lumbung Energi - Indonesia
- Chettinad Cement Corporation Ltd - India
- Baramulti Group, Indonesia
- Borneo Indobara - Indonesia
- Electricity Generating Authority of Thailand
- Thiess Contractors Indonesia
- GMR Energy Limited - India
- Ministry of Mines - Canada
- GN Power Mariveles Coal Plant, Philippines
- Bukit Baiduri Energy - Indonesia
- Central Java Power - Indonesia
- Sical Logistics Limited - India
- Bayan Resources Tbk. - Indonesia
- Standard Chartered Bank - UAE
- Toyota Tsusho Corporation, Japan
- Coal and Oil Company - UAE
- Savvy Resources Ltd - HongKong
- Sree Jayajothi Cements Limited - India
- Posco Energy - South Korea
- Maharashtra Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- Salva Resources Pvt Ltd - India
- Minerals Council of Australia
- Bharathi Cement Corporation - India
- The State Trading Corporation of India Ltd
- Bhoruka Overseas - Indonesia
- Port Waratah Coal Services - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- IHS Mccloskey Coal Group - USA
- Bukit Makmur.PT - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Kohat Cement Company Ltd. - Pakistan
- Rio Tinto Coal - Australia
- AsiaOL BioFuels Corp., Philippines
- OPG Power Generation Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Essar Steel Hazira Ltd - India
- Orica Mining Services - Indonesia
- San Jose City I Power Corp, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Asmin Koalindo Tuhup - Indonesia
- Kaltim Prima Coal - Indonesia
- Tata Chemicals Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Globalindo Alam Lestari - Indonesia
- TeaM Sual Corporation - Philippines
- Larsen & Toubro Limited - India
- Medco Energi Mining Internasional
- The University of Queensland
- Cigading International Bulk Terminal - Indonesia
- Bhatia International Limited - India
- Mintek Dendrill Indonesia
- Deloitte Consulting - India
- Commonwealth Bank - Australia
- Gujarat Mineral Development Corp Ltd - India
- Goldman Sachs - Singapore
- Banpu Public Company Limited - Thailand
- Mercuria Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Iligan Light & Power Inc, Philippines
- Global Business Power Corporation, Philippines
- Interocean Group of Companies - India
- Orica Australia Pty. Ltd.
- Maheswari Brothers Coal Limited - India
- Siam City Cement PLC, Thailand
- Global Green Power PLC Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Sojitz Corporation - Japan
- Parliament of New Zealand
- Eastern Coal Council - USA
- Gujarat Electricity Regulatory Commission - India
- Kobexindo Tractors - Indoneisa
- ICICI Bank Limited - India
- Malabar Cements Ltd - India
- Straits Asia Resources Limited - Singapore
- Indian Oil Corporation Limited
- Marubeni Corporation - India
- Price Waterhouse Coopers - Russia
- Therma Luzon, Inc, Philippines
- CIMB Investment Bank - Malaysia
- Krishnapatnam Port Company Ltd. - India
- Ind-Barath Power Infra Limited - India
- New Zealand Coal & Carbon
- GVK Power & Infra Limited - India
- Formosa Plastics Group - Taiwan
- Attock Cement Pakistan Limited
- LBH Netherlands Bv - Netherlands
- Kideco Jaya Agung - Indonesia
- International Coal Ventures Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Manunggal Multi Energi - Indonesia
- Sarangani Energy Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Star Paper Mills Limited - India
- Meenaskhi Energy Private Limited - India
- Bulk Trading Sa - Switzerland
- Carbofer General Trading SA - India
- Indian Energy Exchange, India
- Indika Energy - Indonesia
- Siam City Cement - Thailand
- Edison Trading Spa - Italy
- Electricity Authority, New Zealand
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Mjunction Services Limited - India
- Barasentosa Lestari - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indonesian Coal Mining Association
- Vijayanagar Sugar Pvt Ltd - India
- London Commodity Brokers - England
- Kartika Selabumi Mining - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Coalindo Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- Grasim Industreis Ltd - India
- SMG Consultants - Indonesia
- Indo Tambangraya Megah - Indonesia
- Chamber of Mines of South Africa
- Samtan Co., Ltd - South Korea
- Sinarmas Energy and Mining - Indonesia
- Renaissance Capital - South Africa
- Aditya Birla Group - India
- Planning Commission, India
- Australian Commodity Traders Exchange
- Ministry of Finance - Indonesia
- Makarim & Taira - Indonesia
- Wood Mackenzie - Singapore
- Semirara Mining Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- Tamil Nadu electricity Board
- Merrill Lynch Commodities Europe
- Trasteel International SA, Italy
- Lanco Infratech Ltd - India
- Energy Link Ltd, New Zealand
- VISA Power Limited - India
- Power Finance Corporation Ltd., India
- Singapore Mercantile Exchange
- Anglo American - United Kingdom
- Uttam Galva Steels Limited - India
- Parry Sugars Refinery, India
- Karaikal Port Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Jorong Barutama Greston.PT - Indonesia
- Altura Mining Limited, Indonesia
- South Luzon Thermal Energy Corporation
- Petron Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Xindia Steels Limited - India
- Georgia Ports Authority, United States
- European Bulk Services B.V. - Netherlands
- Bangladesh Power Developement Board
- IEA Clean Coal Centre - UK
- Gujarat Sidhee Cement - India
- PTC India Limited - India
- Intertek Mineral Services - Indonesia
- Meralco Power Generation, Philippines
- Wilmar Investment Holdings
- Asia Pacific Energy Resources Ventures Inc, Philippines
- McConnell Dowell - Australia
- Agrawal Coal Company - India
- Independent Power Producers Association of India
- White Energy Company Limited
- Aboitiz Power Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Heidelberg Cement - Germany
- Kumho Petrochemical, South Korea
- CNBM International Corporation - China
- India Bulls Power Limited - India
- Ambuja Cements Ltd - India
- SMC Global Power, Philippines
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