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Tuesday, 16 December 14
THIS PRICE IS A STEAL - EVA TZIMA
 COALspot.com: Despite concerns that the slowdown of the Chinese economy would affect imports of iron ore, it seems that this has not been the case so far. The Chinese have been importing record volumes of iron ore throughout the year, taking advantage of softening prices, which touched their lowest level in five years a few days ago. Firm supply from Brazil and Australia has also supported this trend. Both producers, with a combined global market share of over 70%, have been steadily increasing their production post 2000, mainly guided by the mandate of accelerating Chinese appetite.
The boom of economic development in China has in turn made the country “the gift that keeps on giving” for mineral exporters across the globe. Big iron ore producers have been speeding up their sup-ply post 2000, mainly relying on what seemed as a race by China to match its infrastructure with its growth, but somewhere along the lines the fact that the gradual westernization of China, would at some point translate into deceleration of steel consumption was probably overlooked by the market, which brings us to today.
The growth of steel consumption in the country turned red for the first time in over two decades. The slowdown in property construction has quickly curbed the domestic need for steel and consequent-ly iron ore to a significant degree, which translated to excess production of steel as well as increasing iron ore stockpiles. In turn prices for both commodities started sliding, kick starting a vicious cycle of downward pressure.
From one hand, iron ore production was not tamed by the big ex-porters in order to support prices. As big miners in both Australia and Brazil have designed their production capacity around an economy of scale model, cutting down their production to match softening demand growth has not been an option to them, while this also gave them the means to start squeezing the bottom line of their Chinese competitors. At the same time, the Chinese themselves remained buyers of iron ore, enticed by the new attractive price levels they have long desired, with local steel producers remaining active de-spite the fact that domestic demand had started to scale back significantly. That led to surging exports, with cheap Chinese steel flooding the markets, further weighing on global prices.
In both iron ore and steel markets the prospects remain dim, with no evidence suggesting that a reversal is imminent. November was the second lowest month of the year in terms of Chinese iron ore imports, while the country’s exports of steel surged to a record high. Exhausting the stallion of the developing economies in the “becoming a developed country” race, means that in the not so distant future, China could see its growing appetite for growth linked commodities squeezed further. It is often said lately that India or other developing economies could step up to fill in the demand gap created by China, but let’s not forget that history doesn’t always repeat itself.
The truth is that the world in which China emerged as the big economy it currently is, is a very different place today. Developing economies nowadays cannot rely on developed ones to accelerate their growth in the same degree they used to, as most of the latter still struggle themselves with ailing growth, while at the same time and even most importantly, the belief that free trade is always affected during periods of economic crisis is becoming more evident these days. India has persistently tried to promote the “Make in India” and although the policy has met little success so far, Prime Minister Modi has made the idea of stop relying on imports for some of the most important commodities and start using domestic reserves, his personal goal.
My opinion is that more countries will try to protect their domestic production amidst evidence that the path out of the economic crisis now appears longer than what we originally thought it would be. In doing so, they will have to allow for ample room for protectionism measures to be applied, setting limits on quantity and/or price of imports, in order to support domestic production instead, which is exactly the opposite of what the extrovert in nature shipping industry needs.
Eva Tzima
Research Analyst
Compiled by:
Intermodal Research & Valuations
About the Author
Eva Tzima has experience of more than a decade as a financial analyst and has focused on the shipping industry through private equity projects as well as maritime stock analysis. Since 2012 she has been working as a Research analyst at Intermodal Shipbrokers Co., where she currently holds the position of Head of Research, focusing in the specific analysis of the SnP, Newbuilding and Demolition markets across the Dry Bulk, Tanker, Container and Gas Carrier sectors.
Previous to her current post she worked as an investment manager for a privately owned portfolio and in Trafalgar Asset Managers Ltd in London, mainly focusing in Private Equity Projects in the shipping, energy and aircraft sectors, as well as in Primary and Secondary Debt investments. During her employment in Trafalgar she acted as a director across a number of boards of entities affiliated to Trafalgar.
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.
Information contained within the website of COALspot.com is intended for informational purposes only and is not intended as professional counsel and should not be used as such.
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Thursday, 05 February 15
ULTRAMAX LEVELS FROM INDIA TO CHINA IN THE MID US$ 5000'S - FEARNLEYS AS
Handy
Despite the overall weak sentiment, there is a scent of optimism in the Atlantic market for ppt dates. Continent is still struggling with o ...
Wednesday, 04 February 15
MARKET INSIGHT - LINOS KOGEVINAS
It has been just about over 2 months since, in a move that surprised many and caused widespread apprehension, OPEC decided to maintain its producti ...
Tuesday, 03 February 15
Q1'15 FOB INDONESIA COAL SWAP CLOSED $ 3.29 HIGHER COMPARED TO Q4'15 DELIVERY PRICE
COALspot.com: Indonesian coal swaps for delivery Q1' 2015 rose week over week and month on month.
The Q1 swap up US$ 0.68 (+1.41%) month o ...
Tuesday, 03 February 15
FOB NEWCASTLE COAL SWAP FOR Q4 DELIVERY CLOSED 5.86% LOWER THAN Q1 PRICE
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2015 delivery rose US$ 0.26 per MT (+0.51%) week over week and declined US$ 0.02 (-0.04%) ...
Monday, 02 February 15
API 4 FOB RICHARDS BAY COAL SWAP ROSE WEEK OVER WEEK
COALspot.com: API 4 FOB Richards Bay Coal swap for delivery Q1' 2015 declined month over month and day on day.
The Q1 swap has decli ...
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Showing 3216 to 3220 news of total 6871 |
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- Maheswari Brothers Coal Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Eastern Energy - Thailand
- Economic Council, Georgia
- Alfred C Toepfer International GmbH - Germany
- Orica Australia Pty. Ltd.
- Parliament of New Zealand
- Singapore Mercantile Exchange
- Latin American Coal - Colombia
- Malabar Cements Ltd - India
- Electricity Authority, New Zealand
- Commonwealth Bank - Australia
- CNBM International Corporation - China
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mercator Lines Limited - India
- Siam City Cement PLC, Thailand
- Lanco Infratech Ltd - India
- Anglo American - United Kingdom
- Salva Resources Pvt Ltd - India
- The Treasury - Australian Government
- Ministry of Finance - Indonesia
- Directorate Of Revenue Intelligence - India
- Price Waterhouse Coopers - Russia
- Indonesian Coal Mining Association
- Edison Trading Spa - Italy
- London Commodity Brokers - England
- Energy Link Ltd, New Zealand
- Kideco Jaya Agung - Indonesia
- Vedanta Resources Plc - India
- Metalloyd Limited - United Kingdom
- Timah Investasi Mineral - Indoneisa
- Grasim Industreis Ltd - India
- Thiess Contractors Indonesia
- International Coal Ventures Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- White Energy Company Limited
- Jaiprakash Power Ventures ltd
- Star Paper Mills Limited - India
- IEA Clean Coal Centre - UK
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Mintek Dendrill Indonesia
- Essar Steel Hazira Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Attock Cement Pakistan Limited
- Carbofer General Trading SA - India
- OPG Power Generation Pvt Ltd - India
- Wilmar Investment Holdings
- South Luzon Thermal Energy Corporation
- Kalimantan Lumbung Energi - Indonesia
- Bharathi Cement Corporation - India
- GMR Energy Limited - India
- Independent Power Producers Association of India
- LBH Netherlands Bv - Netherlands
- Sindya Power Generating Company Private Ltd
- Global Green Power PLC Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Bhushan Steel Limited - India
- Medco Energi Mining Internasional
- Binh Thuan Hamico - Vietnam
- Karaikal Port Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Heidelberg Cement - Germany
- Larsen & Toubro Limited - India
- Antam Resourcindo - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- PNOC Exploration Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Goldman Sachs - Singapore
- Eastern Coal Council - USA
- Pendopo Energi Batubara - Indonesia
- ASAPP Information Group - India
- Deloitte Consulting - India
- Baramulti Group, Indonesia
- Planning Commission, India
- Dalmia Cement Bharat India
- Miang Besar Coal Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- Bangladesh Power Developement Board
- GAC Shipping (India) Pvt Ltd
- Ministry of Transport, Egypt
- Leighton Contractors Pty Ltd - Australia
- Kobexindo Tractors - Indoneisa
- Merrill Lynch Commodities Europe
- Kartika Selabumi Mining - Indonesia
- Central Electricity Authority - India
- MS Steel International - UAE
- Formosa Plastics Group - Taiwan
- Rio Tinto Coal - Australia
- Thai Mozambique Logistica
- Aditya Birla Group - India
- Power Finance Corporation Ltd., India
- Bahari Cakrawala Sebuku - Indonesia
- Kaltim Prima Coal - Indonesia
- Indian Energy Exchange, India
- PowerSource Philippines DevCo
- San Jose City I Power Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- European Bulk Services B.V. - Netherlands
- Electricity Generating Authority of Thailand
- New Zealand Coal & Carbon
- Krishnapatnam Port Company Ltd. - India
- Mjunction Services Limited - India
- Coalindo Energy - Indonesia
- Bhatia International Limited - India
- Indogreen Group - Indonesia
- Therma Luzon, Inc, Philippines
- SMG Consultants - Indonesia
- IHS Mccloskey Coal Group - USA
- Petrochimia International Co. Ltd.- Taiwan
- Mercuria Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Global Business Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Tamil Nadu electricity Board
- Jorong Barutama Greston.PT - Indonesia
- Jindal Steel & Power Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Port Waratah Coal Services - Australia
- Toyota Tsusho Corporation, Japan
- Makarim & Taira - Indonesia
- The University of Queensland
- Uttam Galva Steels Limited - India
- Altura Mining Limited, Indonesia
- Wood Mackenzie - Singapore
- Barasentosa Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- ICICI Bank Limited - India
- Indika Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Sical Logistics Limited - India
- AsiaOL BioFuels Corp., Philippines
- Romanian Commodities Exchange
- Rashtriya Ispat Nigam Limited - India
- Agrawal Coal Company - India
- Maharashtra Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- VISA Power Limited - India
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- Oldendorff Carriers - Singapore
- Georgia Ports Authority, United States
- Ind-Barath Power Infra Limited - India
- PTC India Limited - India
- Semirara Mining and Power Corporation, Philippines
- Central Java Power - Indonesia
- SN Aboitiz Power Inc, Philippines
- Marubeni Corporation - India
- Asmin Koalindo Tuhup - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Standard Chartered Bank - UAE
- Bhoruka Overseas - Indonesia
- Bayan Resources Tbk. - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kohat Cement Company Ltd. - Pakistan
- Orica Mining Services - Indonesia
- Siam City Cement - Thailand
- SMC Global Power, Philippines
- Kumho Petrochemical, South Korea
- Banpu Public Company Limited - Thailand
- Africa Commodities Group - South Africa
- Meralco Power Generation, Philippines
- Bukit Baiduri Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Posco Energy - South Korea
- Trasteel International SA, Italy
- Globalindo Alam Lestari - Indonesia
- Sakthi Sugars Limited - India
- Australian Commodity Traders Exchange
- Chamber of Mines of South Africa
- Riau Bara Harum - Indonesia
- Parry Sugars Refinery, India
- Minerals Council of Australia
- Chettinad Cement Corporation Ltd - India
- Interocean Group of Companies - India
- Videocon Industries ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Iligan Light & Power Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Samtan Co., Ltd - South Korea
- Sojitz Corporation - Japan
- Gujarat Electricity Regulatory Commission - India
- TeaM Sual Corporation - Philippines
- Madhucon Powers Ltd - India
- McConnell Dowell - Australia
- Cement Manufacturers Association - India
- Renaissance Capital - South Africa
- Borneo Indobara - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Indo Tambangraya Megah - Indonesia
- Simpson Spence & Young - Indonesia
- Indian Oil Corporation Limited
- Aboitiz Power Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Tata Chemicals Ltd - India
- Bulk Trading Sa - Switzerland
- Coal and Oil Company - UAE
- Xindia Steels Limited - India
- Semirara Mining Corp, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Australian Coal Association
- Ministry of Mines - Canada
- CIMB Investment Bank - Malaysia
- India Bulls Power Limited - India
- Coastal Gujarat Power Limited - India
- Ambuja Cements Ltd - India
- Vizag Seaport Private Limited - India
- Petron Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Energy Development Corp, Philippines
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