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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, 04 December 13
INDONESIAN COAL EXPORTS VOLUME AND REVENUE IN OCTOBER MARCHED TOWARDS NORTH
COALspot.com: Indonesia, the world's 4th largest coal producer and the largest multi grade coal exporter shipped over $1.76* billion worth of ...
Wednesday, 04 December 13
WEST AUSTRALIA IRON ORE FIXTURES ALSO CONTINUING TO PROVIDE A STEADY FLOW OF BUSINESS FOR CAPES - INTERMODAL
The Dry Bulk market has reversed course this past week, bringing back some of the lost excitement of the past month, as all size segments climbed hi ...
Wednesday, 04 December 13
THE BUYERS' DEMAND IS CONTINUOUSLY BULLISH - KONSTANTINOS KONTOMICHIS
The very low rates that prevailed for the bigger part of 2013 seem to have prepared the ground for buying opportunities for shipping investors. The ...
Wednesday, 04 December 13
SGX AND CFA TO COLLABORATE TO DEVELOP DERIVATIVES MARKETS IN CHINA AND SINGAPORE
Singapore Exchange (SGX) and the China Futures Association (CFA) are cooperating in the development of derivatives markets in China and Singapore.
...
Wednesday, 04 December 13
SGX'S MONTHLY VOLUMES REACHED A RECORD HIGH OF 705,000 MT IN NOVEMBER 2013
COALspot.com: SGX has announced that, it monthly volumes have reached a record high of 705 lots (705,000 mt) in November 2013 with month-end open in ...
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- Kideco Jaya Agung - Indonesia
- Sojitz Corporation - Japan
- Bukit Asam (Persero) Tbk - Indonesia
- SMG Consultants - Indonesia
- Central Electricity Authority - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Tamil Nadu electricity Board
- Sarangani Energy Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- White Energy Company Limited
- Petron Corporation, Philippines
- Planning Commission, India
- The State Trading Corporation of India Ltd
- PowerSource Philippines DevCo
- Electricity Generating Authority of Thailand
- Bayan Resources Tbk. - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Videocon Industries ltd - India
- Cement Manufacturers Association - India
- Chettinad Cement Corporation Ltd - India
- Xindia Steels Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Directorate Of Revenue Intelligence - India
- GMR Energy Limited - India
- Kepco SPC Power Corporation, Philippines
- Latin American Coal - Colombia
- Therma Luzon, Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Romanian Commodities Exchange
- Salva Resources Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Ministry of Transport, Egypt
- Essar Steel Hazira Ltd - India
- PNOC Exploration Corporation - Philippines
- ASAPP Information Group - India
- Indika Energy - Indonesia
- Makarim & Taira - Indonesia
- Electricity Authority, New Zealand
- Indian Oil Corporation Limited
- Jaiprakash Power Ventures ltd
- Uttam Galva Steels Limited - India
- Timah Investasi Mineral - Indoneisa
- Deloitte Consulting - India
- Riau Bara Harum - Indonesia
- International Coal Ventures Pvt Ltd - India
- The University of Queensland
- Thai Mozambique Logistica
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Bhoruka Overseas - Indonesia
- Indonesian Coal Mining Association
- Minerals Council of Australia
- Economic Council, Georgia
- Siam City Cement PLC, Thailand
- Global Green Power PLC Corporation, Philippines
- Georgia Ports Authority, United States
- Bhatia International Limited - India
- Trasteel International SA, Italy
- ICICI Bank Limited - India
- San Jose City I Power Corp, Philippines
- Ambuja Cements Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Antam Resourcindo - Indonesia
- Thiess Contractors Indonesia
- Ministry of Finance - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Coalindo Energy - Indonesia
- McConnell Dowell - Australia
- Aditya Birla Group - India
- Indo Tambangraya Megah - Indonesia
- Africa Commodities Group - South Africa
- Mercuria Energy - Indonesia
- Larsen & Toubro Limited - India
- GVK Power & Infra Limited - India
- PTC India Limited - India
- Banpu Public Company Limited - Thailand
- CIMB Investment Bank - Malaysia
- Renaissance Capital - South Africa
- Bhushan Steel Limited - India
- Edison Trading Spa - Italy
- Australian Coal Association
- Sakthi Sugars Limited - India
- Altura Mining Limited, Indonesia
- London Commodity Brokers - England
- Global Business Power Corporation, Philippines
- Parry Sugars Refinery, India
- Iligan Light & Power Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Interocean Group of Companies - India
- Singapore Mercantile Exchange
- Sindya Power Generating Company Private Ltd
- Malabar Cements Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Ministry of Mines - Canada
- Sical Logistics Limited - India
- Orica Mining Services - Indonesia
- Formosa Plastics Group - Taiwan
- Sree Jayajothi Cements Limited - India
- Goldman Sachs - Singapore
- Jorong Barutama Greston.PT - Indonesia
- GAC Shipping (India) Pvt Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Manunggal Multi Energi - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- The Treasury - Australian Government
- Offshore Bulk Terminal Pte Ltd, Singapore
- Oldendorff Carriers - Singapore
- Grasim Industreis Ltd - India
- MS Steel International - UAE
- Kapuas Tunggal Persada - Indonesia
- Globalindo Alam Lestari - Indonesia
- Meenaskhi Energy Private Limited - India
- Parliament of New Zealand
- Carbofer General Trading SA - India
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement - Thailand
- Lanco Infratech Ltd - India
- VISA Power Limited - India
- Binh Thuan Hamico - Vietnam
- Kumho Petrochemical, South Korea
- Bukit Baiduri Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Price Waterhouse Coopers - Russia
- Mercator Lines Limited - India
- Independent Power Producers Association of India
- Mjunction Services Limited - India
- Kobexindo Tractors - Indoneisa
- Barasentosa Lestari - Indonesia
- Agrawal Coal Company - India
- Tata Chemicals Ltd - India
- Vizag Seaport Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- TeaM Sual Corporation - Philippines
- Bangladesh Power Developement Board
- Kalimantan Lumbung Energi - Indonesia
- Bharathi Cement Corporation - India
- Global Coal Blending Company Limited - Australia
- Aboitiz Power Corporation - Philippines
- New Zealand Coal & Carbon
- Directorate General of MIneral and Coal - Indonesia
- Intertek Mineral Services - Indonesia
- Energy Development Corp, Philippines
- Simpson Spence & Young - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- India Bulls Power Limited - India
- Indogreen Group - Indonesia
- Commonwealth Bank - Australia
- Chamber of Mines of South Africa
- Kartika Selabumi Mining - Indonesia
- Dalmia Cement Bharat India
- Savvy Resources Ltd - HongKong
- South Luzon Thermal Energy Corporation
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Cigading International Bulk Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Energy Link Ltd, New Zealand
- Indian Energy Exchange, India
- Merrill Lynch Commodities Europe
- Orica Australia Pty. Ltd.
- Madhucon Powers Ltd - India
- Gujarat Sidhee Cement - India
- Straits Asia Resources Limited - Singapore
- Central Java Power - Indonesia
- Borneo Indobara - Indonesia
- Pendopo Energi Batubara - Indonesia
- Heidelberg Cement - Germany
- Baramulti Group, Indonesia
- Karaikal Port Pvt Ltd - India
- Rio Tinto Coal - Australia
- Samtan Co., Ltd - South Korea
- Marubeni Corporation - India
- OPG Power Generation Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Gujarat Electricity Regulatory Commission - India
- Bulk Trading Sa - Switzerland
- Coastal Gujarat Power Limited - India
- Power Finance Corporation Ltd., India
- Leighton Contractors Pty Ltd - Australia
- IEA Clean Coal Centre - UK
- Wilmar Investment Holdings
- Eastern Energy - Thailand
- Posco Energy - South Korea
- Meralco Power Generation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Medco Energi Mining Internasional
- Kaltim Prima Coal - Indonesia
- Metalloyd Limited - United Kingdom
- SMC Global Power, Philippines
- Attock Cement Pakistan Limited
- Vedanta Resources Plc - India
- Semirara Mining Corp, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Coal and Oil Company - UAE
- Toyota Tsusho Corporation, Japan
- European Bulk Services B.V. - Netherlands
- Anglo American - United Kingdom
- Ind-Barath Power Infra Limited - India
- SN Aboitiz Power Inc, Philippines
- CNBM International Corporation - China
- GN Power Mariveles Coal Plant, Philippines
- Star Paper Mills Limited - India
- Australian Commodity Traders Exchange
- PetroVietnam Power Coal Import and Supply Company
- LBH Netherlands Bv - Netherlands
- Kohat Cement Company Ltd. - Pakistan
- Mintek Dendrill Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Wood Mackenzie - Singapore
- Bukit Makmur.PT - Indonesia
- IHS Mccloskey Coal Group - USA
- Eastern Coal Council - USA
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