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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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Tuesday, 23 December 14
Q4'15 FOB RICHARDS BAY COAL SWAPS FALL $ 3.85 IN A MONTH
COALspot.com: API 4 FOB Richards Bay Coal for delivery Q1' 2015 lost month on month.
The Q1 swap has lost US$ 2.13 (-3.17%) month on month ...
Tuesday, 23 December 14
SHIPOWNERS ARE FINALIZING MORE DEALS AS YEAR END COMES CLOSER - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS WORLDWIDE
With the 2014 year just a few days before waving goodbye, shipowners are looking to close their pending deals in both the newbuilding and S&P m ...
Monday, 22 December 14
Q2'15 CFR SOUTH CHINA COAL SWAP CLOSED $ 0.30 LOWER THAN Q1'15 CLOSING
COALspot.com: API 8 CFR South China Coal swap for Q1’ 2015 delivery has decreased by US$ 3.67 (-5.81%) month over month and US$ 0.35 (-0.58%) ...
Monday, 22 December 14
API 5 FOB NEWCASTLE COAL SWAPS ARE HEADING SOUTH
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2015 delivery lost US$ 1.71 per MT (-3.24%) and closed at US$ 51.02 on 19 December month ...
Sunday, 21 December 14
PANAMAX COAL FREIGHT FROM INDONESIA TO INDIA FALLS FURTHER
COALspot.com: The BDI continued its fall as cape index lost heavily week on week.
The BDI was down 6.95 percent week over week and closed at 8 ...
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- Essar Steel Hazira Ltd - India
- Agrawal Coal Company - India
- Orica Mining Services - Indonesia
- Mjunction Services Limited - India
- Thiess Contractors Indonesia
- CNBM International Corporation - China
- ICICI Bank Limited - India
- Indogreen Group - Indonesia
- MS Steel International - UAE
- Mercuria Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Commonwealth Bank - Australia
- Thai Mozambique Logistica
- Dalmia Cement Bharat India
- Iligan Light & Power Inc, Philippines
- Vedanta Resources Plc - India
- Economic Council, Georgia
- Maheswari Brothers Coal Limited - India
- Marubeni Corporation - India
- Minerals Council of Australia
- Bangladesh Power Developement Board
- Indo Tambangraya Megah - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Aditya Birla Group - India
- New Zealand Coal & Carbon
- PTC India Limited - India
- GVK Power & Infra Limited - India
- Sarangani Energy Corporation, Philippines
- Grasim Industreis Ltd - India
- Tamil Nadu electricity Board
- Sindya Power Generating Company Private Ltd
- Karbindo Abesyapradhi - Indoneisa
- Trasteel International SA, Italy
- GMR Energy Limited - India
- Baramulti Group, Indonesia
- TeaM Sual Corporation - Philippines
- Samtan Co., Ltd - South Korea
- VISA Power Limited - India
- Malabar Cements Ltd - India
- Larsen & Toubro Limited - India
- Chamber of Mines of South Africa
- Oldendorff Carriers - Singapore
- Mercator Lines Limited - India
- Wilmar Investment Holdings
- PNOC Exploration Corporation - Philippines
- Siam City Cement - Thailand
- Ambuja Cements Ltd - India
- Electricity Authority, New Zealand
- Madhucon Powers Ltd - India
- Siam City Cement PLC, Thailand
- Krishnapatnam Port Company Ltd. - India
- Sojitz Corporation - Japan
- Bahari Cakrawala Sebuku - Indonesia
- Antam Resourcindo - Indonesia
- GAC Shipping (India) Pvt Ltd
- Renaissance Capital - South Africa
- India Bulls Power Limited - India
- Africa Commodities Group - South Africa
- Georgia Ports Authority, United States
- Australian Commodity Traders Exchange
- SMC Global Power, Philippines
- Uttam Galva Steels Limited - India
- Sree Jayajothi Cements Limited - India
- Kaltim Prima Coal - Indonesia
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Petrochimia International Co. Ltd.- Taiwan
- Sical Logistics Limited - India
- Lanco Infratech Ltd - India
- Tata Chemicals Ltd - India
- South Luzon Thermal Energy Corporation
- Medco Energi Mining Internasional
- Ceylon Electricity Board - Sri Lanka
- Energy Link Ltd, New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Cigading International Bulk Terminal - Indonesia
- Attock Cement Pakistan Limited
- Barasentosa Lestari - Indonesia
- Electricity Generating Authority of Thailand
- Parliament of New Zealand
- Ministry of Finance - Indonesia
- Star Paper Mills Limited - India
- Global Green Power PLC Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Goldman Sachs - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Bharathi Cement Corporation - India
- Bhushan Steel Limited - India
- Banpu Public Company Limited - Thailand
- Standard Chartered Bank - UAE
- Port Waratah Coal Services - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vizag Seaport Private Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Central Java Power - Indonesia
- OPG Power Generation Pvt Ltd - India
- Videocon Industries ltd - India
- Meenaskhi Energy Private Limited - India
- Posco Energy - South Korea
- Price Waterhouse Coopers - Russia
- Independent Power Producers Association of India
- San Jose City I Power Corp, Philippines
- White Energy Company Limited
- The Treasury - Australian Government
- Ministry of Transport, Egypt
- Intertek Mineral Services - Indonesia
- Interocean Group of Companies - India
- International Coal Ventures Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- Coastal Gujarat Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Manunggal Multi Energi - Indonesia
- Altura Mining Limited, Indonesia
- Salva Resources Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Edison Trading Spa - Italy
- Kapuas Tunggal Persada - Indonesia
- Kumho Petrochemical, South Korea
- Heidelberg Cement - Germany
- Directorate Of Revenue Intelligence - India
- Bhatia International Limited - India
- Jaiprakash Power Ventures ltd
- Formosa Plastics Group - Taiwan
- Bukit Makmur.PT - Indonesia
- Indian Energy Exchange, India
- Energy Development Corp, Philippines
- Power Finance Corporation Ltd., India
- Bayan Resources Tbk. - Indonesia
- SMG Consultants - Indonesia
- Planning Commission, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Xindia Steels Limited - India
- Globalindo Alam Lestari - Indonesia
- Therma Luzon, Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Jindal Steel & Power Ltd - India
- Central Electricity Authority - India
- Kalimantan Lumbung Energi - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bhoruka Overseas - Indonesia
- Ind-Barath Power Infra Limited - India
- The University of Queensland
- Jorong Barutama Greston.PT - Indonesia
- Deloitte Consulting - India
- Indian Oil Corporation Limited
- Parry Sugars Refinery, India
- Neyveli Lignite Corporation Ltd, - India
- Alfred C Toepfer International GmbH - Germany
- Makarim & Taira - Indonesia
- Pendopo Energi Batubara - Indonesia
- Coalindo Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Wood Mackenzie - Singapore
- Gujarat Sidhee Cement - India
- The State Trading Corporation of India Ltd
- London Commodity Brokers - England
- Straits Asia Resources Limited - Singapore
- Kideco Jaya Agung - Indonesia
- Global Coal Blending Company Limited - Australia
- Toyota Tsusho Corporation, Japan
- Anglo American - United Kingdom
- Latin American Coal - Colombia
- PetroVietnam Power Coal Import and Supply Company
- Coal and Oil Company - UAE
- Orica Australia Pty. Ltd.
- Australian Coal Association
- Bulk Trading Sa - Switzerland
- Global Business Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Mines - Canada
- Cement Manufacturers Association - India
- Borneo Indobara - Indonesia
- Romanian Commodities Exchange
- ASAPP Information Group - India
- Kobexindo Tractors - Indoneisa
- Savvy Resources Ltd - HongKong
- Pipit Mutiara Jaya. PT, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Mintek Dendrill Indonesia
- McConnell Dowell - Australia
- AsiaOL BioFuels Corp., Philippines
- Rio Tinto Coal - Australia
- SN Aboitiz Power Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Eastern Energy - Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Eastern Coal Council - USA
- TNB Fuel Sdn Bhd - Malaysia
- Maharashtra Electricity Regulatory Commission - India
- Simpson Spence & Young - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Baiduri Energy - Indonesia
- Petron Corporation, Philippines
- Indika Energy - Indonesia
- Riau Bara Harum - Indonesia
- Indonesian Coal Mining Association
- Vijayanagar Sugar Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Bukit Asam (Persero) Tbk - Indonesia
- Metalloyd Limited - United Kingdom
- Chettinad Cement Corporation Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Carbofer General Trading SA - India
- IHS Mccloskey Coal Group - USA
- Karaikal Port Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- CIMB Investment Bank - Malaysia
- Meralco Power Generation, Philippines
- European Bulk Services B.V. - Netherlands
- PowerSource Philippines DevCo
- Timah Investasi Mineral - Indoneisa
- IEA Clean Coal Centre - UK
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