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Wednesday, 09 July 14
SHIPPING MARKET INSIGHT - PANOS TSILINGIRIS
 The mini-boom in dry bulker values catapulted ship prices too fast too far over the last one-and-a-half year. The concurrence of historically low prices in both second-hand and newbuilding markets, which approached the post Asian crisis lows in inflation-adjusted terms, offered the perfect background for asset play, but this is much easier said than done.
Most real-world buy-low-sell-higher cases concentrated on the flipping of newbuildings contracted at rock-bottom prices when we witnessed Handysize Newbuildings at sub-20musd levels, Ultramaxes at sub-24musd, Kamsarmaxes at rgn 26musd, and Capes at low-mid 40s. Notably, Cargill penned in May 2013 3x180kdwt Capes at SWS, acknowledging they would not operate these ships forever, and by the end of the same year sold them to Scorpio at 57musd each at a stunning rgn10musd profit per vessel. Oldendorff purchased a Crown-63 resale in late 2012 for mid-24s and after trading her, sold her for rgn31musd to Greeks. The same interests recently sold to Diana, a 180k Capesize resale under construction at Qingdao Beihai, for 58musd and a profit in excess of 10musd.
S&P-wise, the appreciation was spectacular on all dry asset classes last year. Regarding LME Panamaxes, ex-Ocean Planet (‘05 Sasebo) was committed in January 2013 by Chartworld at sub-m$15 while ex-Ocean Lily (’06 Imabari) was sold to Sanko close to 25musd this March, resulting in a 2/3 value appreciation in 14mos. While initial appreciation was substantiated, it went on irrationally (mimicry, artificial liquidity by the speculative funds, fear of ‘losing’ the market or even having money in the bank, taxation considerations, low interest rates, etc). On a few S&P asset play cases, in late 2012 Norwegian interests committed the 2006-built Tsuneishi Kamsarmax ex ‘Mizunagi Maru’ arnd 18.4musd and sold her a year later at 23.5musd to Greek interests enjoying a 5musd profit. Chinese owners also got on the bandwagon, having sold two late 90s Capes (m/v Lian Fu Star and m/v Tai Fu Star) to Ukrainians at mid/high teens recording a profit of rgn/xs 5musd per vessel in less than a year.
The current price correction is evidenced by the sale of the ‘Yusho Spica’ at rgn 20musd marked an abrupt 5musd discount from her same-year built sister ‘Ocean Lily’ 3 months ago. This brings asset values back to May 2013 when the ex-Shoyo (76k ’06 Namura) was sold at 20.25musd to Diana. Most likely, the current correction will not break soon the previous lows, because the costs of creating a new asset, ie, newbuilding prices, are well above previous lows and there are still many buyers/funds getting ready to step in, should a further correction in asset values occurs.
Well-timed acquisitions materialize when the others are fearful, when the banks do not lend money, when speculative money becomes disappointed. Nobody knows where we are heading but the recent past has benchmarked a lower bound for assets. As such, there may be longer-term value in modern S&P deals priced up to a 20% premium above the rock-bottom (e.g. a 2006/7 Japanese built Panamax BC at 18musd) and at a respective 10% premium for newbuildings (e.g., rgn/sub 29-30musd for Kamsa NBs from top Chinese yards). We may be getting close to there, but there are strong resistance forces as well.
Perhaps the wildest scenario would arise if the freight market stays depressed for another year and asset prices deteriorate further. What would then be the reaction of the speculative funds that, having a short-term investment horizon anyway, may massively look for an exit? In case this happens, it may signal the biggest asset play opportunity in the coming years.
By Panos Tsilingiris - SnP Broker
Analysts:
Mr. George Lazaridis
Ms. Eva Tzima
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no re-producing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
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Tuesday, 22 July 14
INDONESIA'S MINERAL EXPORT BAN: CHINA UNDER PRESSURE? - CLARKSONS
In January 2014, Indonesia introduced new regulations on exports of unprocessed minerals. Exports of some minerals have been heavily taxed, whilst ...
Tuesday, 22 July 14
ASIAN SUB-BITUMINOUS COAL USERS' GROUP CONFERENCE
Press Release: Registration Open for Fourth Annual Asian Sub-Bituminous Coal Users’ Group Conference
Register today for this year&r ...
Monday, 21 July 14
25% OF INDIA'S POWER PLANTS WERE HAVING SUPER CRITICAL COAL STOCK - COAL AND POWER MINISTER
25% of India’s power plants were having super critical coal stock; power utilities have also been advised to enhance the import of coal - Coa ...
Monday, 21 July 14
INDONESIA'S STATE CONTROLLED COAL MINER BUKIT ASAM ENJOYED HIGHER SELLING PRICE DURING THIS STORMY MARKET
COALspot.com: PT Bukit Asam, the Indonesian government controlled coal miner announced today that, the company has produced 7.70 million tons of co ...
Monday, 21 July 14
CFR SOUTH CHINA COAL Q3 DELIVERY SWAPS LOST 16% SINCE JANUARY 17, 2014
COALspot.com: Coal price falling is continues as the impact oversupply and lower demand. Market is not showing any positive trend in near future.
...
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- Bahari Cakrawala Sebuku - Indonesia
- Power Finance Corporation Ltd., India
- Intertek Mineral Services - Indonesia
- Essar Steel Hazira Ltd - India
- Eastern Coal Council - USA
- Gujarat Mineral Development Corp Ltd - India
- Tamil Nadu electricity Board
- Malabar Cements Ltd - India
- Ministry of Transport, Egypt
- Formosa Plastics Group - Taiwan
- Altura Mining Limited, Indonesia
- Siam City Cement PLC, Thailand
- SMG Consultants - Indonesia
- Meenaskhi Energy Private Limited - India
- Ambuja Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Georgia Ports Authority, United States
- Iligan Light & Power Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Indonesian Coal Mining Association
- Therma Luzon, Inc, Philippines
- ASAPP Information Group - India
- Borneo Indobara - Indonesia
- Posco Energy - South Korea
- Oldendorff Carriers - Singapore
- IHS Mccloskey Coal Group - USA
- Bayan Resources Tbk. - Indonesia
- Australian Commodity Traders Exchange
- Minerals Council of Australia
- AsiaOL BioFuels Corp., Philippines
- Price Waterhouse Coopers - Russia
- Aditya Birla Group - India
- Coalindo Energy - Indonesia
- CNBM International Corporation - China
- Semirara Mining and Power Corporation, Philippines
- Bhushan Steel Limited - India
- Bhatia International Limited - India
- Gujarat Sidhee Cement - India
- Agrawal Coal Company - India
- San Jose City I Power Corp, Philippines
- Siam City Cement - Thailand
- Simpson Spence & Young - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Mercator Lines Limited - India
- Directorate Of Revenue Intelligence - India
- Wilmar Investment Holdings
- VISA Power Limited - India
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- Salva Resources Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Kalimantan Lumbung Energi - Indonesia
- Manunggal Multi Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Wood Mackenzie - Singapore
- Kepco SPC Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Independent Power Producers Association of India
- PNOC Exploration Corporation - Philippines
- Central Electricity Authority - India
- Rio Tinto Coal - Australia
- Africa Commodities Group - South Africa
- Bhoruka Overseas - Indonesia
- Orica Mining Services - Indonesia
- Central Java Power - Indonesia
- Indogreen Group - Indonesia
- Heidelberg Cement - Germany
- Thai Mozambique Logistica
- Neyveli Lignite Corporation Ltd, - India
- Romanian Commodities Exchange
- Sical Logistics Limited - India
- Global Coal Blending Company Limited - Australia
- Anglo American - United Kingdom
- Renaissance Capital - South Africa
- Globalindo Alam Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- India Bulls Power Limited - India
- Jaiprakash Power Ventures ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Makarim & Taira - Indonesia
- MS Steel International - UAE
- Global Business Power Corporation, Philippines
- Ministry of Mines - Canada
- Port Waratah Coal Services - Australia
- Coastal Gujarat Power Limited - India
- Karaikal Port Pvt Ltd - India
- Vedanta Resources Plc - India
- Bukit Baiduri Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Ministry of Finance - Indonesia
- Mjunction Services Limited - India
- Billiton Holdings Pty Ltd - Australia
- Interocean Group of Companies - India
- GVK Power & Infra Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GMR Energy Limited - India
- Parliament of New Zealand
- Electricity Authority, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Global Green Power PLC Corporation, Philippines
- Energy Link Ltd, New Zealand
- Dalmia Cement Bharat India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Cement Manufacturers Association - India
- SMC Global Power, Philippines
- Banpu Public Company Limited - Thailand
- ICICI Bank Limited - India
- Eastern Energy - Thailand
- Pendopo Energi Batubara - Indonesia
- Sinarmas Energy and Mining - Indonesia
- The State Trading Corporation of India Ltd
- LBH Netherlands Bv - Netherlands
- Toyota Tsusho Corporation, Japan
- Edison Trading Spa - Italy
- Mercuria Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Barasentosa Lestari - Indonesia
- Kaltim Prima Coal - Indonesia
- Indo Tambangraya Megah - Indonesia
- McConnell Dowell - Australia
- Mintek Dendrill Indonesia
- Ceylon Electricity Board - Sri Lanka
- Bharathi Cement Corporation - India
- Indika Energy - Indonesia
- The Treasury - Australian Government
- Ind-Barath Power Infra Limited - India
- Sojitz Corporation - Japan
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- Kartika Selabumi Mining - Indonesia
- Vizag Seaport Private Limited - India
- Tata Chemicals Ltd - India
- Orica Australia Pty. Ltd.
- Larsen & Toubro Limited - India
- The University of Queensland
- Bukit Makmur.PT - Indonesia
- Jindal Steel & Power Ltd - India
- Straits Asia Resources Limited - Singapore
- Kobexindo Tractors - Indoneisa
- Pipit Mutiara Jaya. PT, Indonesia
- CIMB Investment Bank - Malaysia
- Leighton Contractors Pty Ltd - Australia
- European Bulk Services B.V. - Netherlands
- Coal and Oil Company - UAE
- GAC Shipping (India) Pvt Ltd
- Standard Chartered Bank - UAE
- IEA Clean Coal Centre - UK
- Maheswari Brothers Coal Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- Commonwealth Bank - Australia
- Timah Investasi Mineral - Indoneisa
- Riau Bara Harum - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Trasteel International SA, Italy
- Semirara Mining Corp, Philippines
- Singapore Mercantile Exchange
- Madhucon Powers Ltd - India
- Chettinad Cement Corporation Ltd - India
- Kideco Jaya Agung - Indonesia
- Energy Development Corp, Philippines
- Star Paper Mills Limited - India
- New Zealand Coal & Carbon
- Electricity Generating Authority of Thailand
- Sarangani Energy Corporation, Philippines
- Uttam Galva Steels Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Latin American Coal - Colombia
- Baramulti Group, Indonesia
- Karbindo Abesyapradhi - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Sakthi Sugars Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Aboitiz Power Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Chamber of Mines of South Africa
- Miang Besar Coal Terminal - Indonesia
- London Commodity Brokers - England
- Kapuas Tunggal Persada - Indonesia
- International Coal Ventures Pvt Ltd - India
- White Energy Company Limited
- Australian Coal Association
- Indian Oil Corporation Limited
- Rashtriya Ispat Nigam Limited - India
- Planning Commission, India
- Thiess Contractors Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Xindia Steels Limited - India
- Bangladesh Power Developement Board
- Bulk Trading Sa - Switzerland
- Binh Thuan Hamico - Vietnam
- Antam Resourcindo - Indonesia
- Merrill Lynch Commodities Europe
- Indian Energy Exchange, India
- Metalloyd Limited - United Kingdom
- Lanco Infratech Ltd - India
- Parry Sugars Refinery, India
- TeaM Sual Corporation - Philippines
- Videocon Industries ltd - India
- Medco Energi Mining Internasional
- PowerSource Philippines DevCo
- Marubeni Corporation - India
- Meralco Power Generation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kumho Petrochemical, South Korea
- Deloitte Consulting - India
- Grasim Industreis Ltd - India
- Savvy Resources Ltd - HongKong
- Carbofer General Trading SA - India
- Cigading International Bulk Terminal - Indonesia
- Petron Corporation, Philippines
- South Luzon Thermal Energy Corporation
- TNB Fuel Sdn Bhd - Malaysia
- Economic Council, Georgia
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