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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, 28 October 14
SGX'S FOB RICHARDS BAY COAL SWAP FOR DELIVERY Q1' 2015 CLOSED AT $ 68.07 ON 24 OCT
COALspot.com: API 4 FOB Richards Bay coal swap for Q4’ 2014 delivery decreased US$ 0.65 (-0.96%) month over month and increased US$ 1.79 (+2. ...
Tuesday, 28 October 14
SUB-BIT FOB INDONESIA COAL SWAP FOR Q1' 15 DELIVERY CLOSED 3.68% LOWER MONTH ON MONTH
COALspot.com: Indonesian coal swaps for delivery Q4' 2014 lost month on month and gained day on day and week on week.
The swap has lost US ...
Monday, 27 October 14
GOVT PROMISES TO EASE LICENSING PROCEDURES IN MINING SECTOR - THE JAKARTA POST
The Energy and Mineral Resources Ministry’s directorate general for mineral and coal plans to simplify the complicated licensing procedures i ...
Monday, 27 October 14
FOB NEWCASTLE COAL SWAP FOR Q1' 15 DELIVERY CLOSED $ 0.10 LESSER THAN Q4' 14 CLOSING OF $ 53.27 PMT
COALspot.com: API 5 FOB Newcastle Coal swap for Q4’ 2014 delivery decreased US$ 1.43 (-2.61%) month over month and increased US$ 0.05 (+0.09% ...
Monday, 27 October 14
CFR SOUTH CHINA COAL SWAPS PERFORMED POSITIVE THIS PAST WEEK
COALspot.com: API 8 CFR South China Coal swap for Q4’ 2014 delivery decreased US$ 1.68 (-2.55%) month over month and increased US$ 0.87 (+1.3 ...
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Showing 3406 to 3410 news of total 6871 |
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- Baramulti Group, Indonesia
- CIMB Investment Bank - Malaysia
- Banpu Public Company Limited - Thailand
- Bhoruka Overseas - Indonesia
- Essar Steel Hazira Ltd - India
- Madhucon Powers Ltd - India
- Toyota Tsusho Corporation, Japan
- Manunggal Multi Energi - Indonesia
- Minerals Council of Australia
- Mjunction Services Limited - India
- Posco Energy - South Korea
- SMG Consultants - Indonesia
- PowerSource Philippines DevCo
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Carbofer General Trading SA - India
- Bhushan Steel Limited - India
- MS Steel International - UAE
- European Bulk Services B.V. - Netherlands
- Ind-Barath Power Infra Limited - India
- Renaissance Capital - South Africa
- Chettinad Cement Corporation Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Sarangani Energy Corporation, Philippines
- GMR Energy Limited - India
- Commonwealth Bank - Australia
- Parry Sugars Refinery, India
- GN Power Mariveles Coal Plant, Philippines
- Interocean Group of Companies - India
- Rio Tinto Coal - Australia
- Larsen & Toubro Limited - India
- Central Electricity Authority - India
- Semirara Mining Corp, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Independent Power Producers Association of India
- Oldendorff Carriers - Singapore
- Star Paper Mills Limited - India
- Attock Cement Pakistan Limited
- Bulk Trading Sa - Switzerland
- CNBM International Corporation - China
- Siam City Cement PLC, Thailand
- Tamil Nadu electricity Board
- Global Coal Blending Company Limited - Australia
- Bharathi Cement Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Cement Manufacturers Association - India
- Global Green Power PLC Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Central Java Power - Indonesia
- Kaltim Prima Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Wilmar Investment Holdings
- The Treasury - Australian Government
- Thiess Contractors Indonesia
- Indogreen Group - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Merrill Lynch Commodities Europe
- Kartika Selabumi Mining - Indonesia
- The State Trading Corporation of India Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Jaiprakash Power Ventures ltd
- Dalmia Cement Bharat India
- Port Waratah Coal Services - Australia
- Energy Link Ltd, New Zealand
- Indika Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Bhatia International Limited - India
- Agrawal Coal Company - India
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- Coal and Oil Company - UAE
- Billiton Holdings Pty Ltd - Australia
- Georgia Ports Authority, United States
- Kobexindo Tractors - Indoneisa
- GAC Shipping (India) Pvt Ltd
- Latin American Coal - Colombia
- LBH Netherlands Bv - Netherlands
- Barasentosa Lestari - Indonesia
- New Zealand Coal & Carbon
- Singapore Mercantile Exchange
- International Coal Ventures Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- Mercuria Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- VISA Power Limited - India
- Energy Development Corp, Philippines
- Xindia Steels Limited - India
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement - Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kepco SPC Power Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Coalindo Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Parliament of New Zealand
- Ministry of Finance - Indonesia
- Videocon Industries ltd - India
- AsiaOL BioFuels Corp., Philippines
- Australian Commodity Traders Exchange
- Meenaskhi Energy Private Limited - India
- Romanian Commodities Exchange
- Holcim Trading Pte Ltd - Singapore
- Antam Resourcindo - Indonesia
- Samtan Co., Ltd - South Korea
- Heidelberg Cement - Germany
- Sakthi Sugars Limited - India
- Aditya Birla Group - India
- Karaikal Port Pvt Ltd - India
- Eastern Coal Council - USA
- PNOC Exploration Corporation - Philippines
- Simpson Spence & Young - Indonesia
- Iligan Light & Power Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Goldman Sachs - Singapore
- Salva Resources Pvt Ltd - India
- Uttam Galva Steels Limited - India
- McConnell Dowell - Australia
- Sical Logistics Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Jindal Steel & Power Ltd - India
- Sojitz Corporation - Japan
- Savvy Resources Ltd - HongKong
- Coastal Gujarat Power Limited - India
- Africa Commodities Group - South Africa
- Kalimantan Lumbung Energi - Indonesia
- Meralco Power Generation, Philippines
- San Jose City I Power Corp, Philippines
- Borneo Indobara - Indonesia
- Bukit Makmur.PT - Indonesia
- The University of Queensland
- Tata Chemicals Ltd - India
- Aboitiz Power Corporation - Philippines
- London Commodity Brokers - England
- Chamber of Mines of South Africa
- Vedanta Resources Plc - India
- Neyveli Lignite Corporation Ltd, - India
- ICICI Bank Limited - India
- Sree Jayajothi Cements Limited - India
- Straits Asia Resources Limited - Singapore
- Maheswari Brothers Coal Limited - India
- Intertek Mineral Services - Indonesia
- Altura Mining Limited, Indonesia
- SN Aboitiz Power Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Malabar Cements Ltd - India
- Indian Oil Corporation Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mintek Dendrill Indonesia
- OPG Power Generation Pvt Ltd - India
- Eastern Energy - Thailand
- Medco Energi Mining Internasional
- Maharashtra Electricity Regulatory Commission - India
- TeaM Sual Corporation - Philippines
- Electricity Authority, New Zealand
- Planning Commission, India
- Directorate Of Revenue Intelligence - India
- Vizag Seaport Private Limited - India
- Marubeni Corporation - India
- Standard Chartered Bank - UAE
- South Luzon Thermal Energy Corporation
- IEA Clean Coal Centre - UK
- Indo Tambangraya Megah - Indonesia
- Bayan Resources Tbk. - Indonesia
- Indian Energy Exchange, India
- Krishnapatnam Port Company Ltd. - India
- PetroVietnam Power Coal Import and Supply Company
- Bukit Asam (Persero) Tbk - Indonesia
- Lanco Infratech Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- ASAPP Information Group - India
- Asmin Koalindo Tuhup - Indonesia
- Therma Luzon, Inc, Philippines
- Ministry of Mines - Canada
- Grasim Industreis Ltd - India
- Wood Mackenzie - Singapore
- Kumho Petrochemical, South Korea
- Ministry of Transport, Egypt
- Power Finance Corporation Ltd., India
- SMC Global Power, Philippines
- India Bulls Power Limited - India
- Gujarat Electricity Regulatory Commission - India
- Globalindo Alam Lestari - Indonesia
- GVK Power & Infra Limited - India
- Bangladesh Power Developement Board
- Edison Trading Spa - Italy
- PTC India Limited - India
- Pendopo Energi Batubara - Indonesia
- Riau Bara Harum - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Economic Council, Georgia
- Bahari Cakrawala Sebuku - Indonesia
- Ambuja Cements Ltd - India
- Mercator Lines Limited - India
- Australian Coal Association
- White Energy Company Limited
- Makarim & Taira - Indonesia
- Metalloyd Limited - United Kingdom
- Binh Thuan Hamico - Vietnam
- Thai Mozambique Logistica
- Formosa Plastics Group - Taiwan
- Orica Australia Pty. Ltd.
- Trasteel International SA, Italy
- Deloitte Consulting - India
- Petron Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Indonesian Coal Mining Association
- Anglo American - United Kingdom
- Orica Mining Services - Indonesia
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