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Tuesday, 04 August 15
SHIPPING CYCLES - A CHESS GAME YOU DON'T WANT TO LOSE - CLARKSONS
 Ingmar Bergman’s classic movie The Seventh Seal is about a knight who, during the Black Death, challenges Death to a chess match, in the hope that while the game continues he can put off his demise. This grim epic could be seen as a metaphor for the daunting progress through long shipping cycles, as one risk-laden move in the toxic chess game follows another.
August 2007 – The Game Starts
Today’s cycle started eight years ago in 2007. It was an epic year. Capesize earnings averaged over $110,000/day and merchant shipbuilding investment reached a record $229 billion (excluding offshore). But there was good reason to be apprehensive. In August the first signs of the financial crisis hit Europe, as interbank investors grew paranoid about the vulnerability of their counterparties to CDO exposure, bringing Eurodollar trading to a halt. Meanwhile analysts were worried that the Chinese super-boom would peak out after the Olympic Games in 2008. So although dry bulk investors were still making money and ordering ships, the solitary chess game with destiny had already started.
Mounting A Comeback
Seven years later the chess game is still going on. The financial crisis got off to a more dramatic start than anyone anticipated. In 2008 as panic swept through financial markets and trade credit became almost unobtainable, the world economy, including China, came precariously close to meltdown. But fortunately this time the politicians eased through the crisis successfully. China mounted a heroic infrastructure programme which gave bulkers a very decent boom in 2009-10. Following this the market fluctuated, but reached decent levels in late 2011 and again in late 2013.
Not Deadly Or Distressed?
As recessions go so far the game with destiny has gone quite well. Since the end of 2007 Capesize earnings have averaged $32,300/day and the market has soaked up 490m dwt of new bulkers. In 2013, 104m dwt of bulkers were ordered. So someone in the industry believed bulkers would win their chess game.
But in 2015 the game changed. Capesize earnings averaged only $6,212/day in the first half. For the first time signs of real distress are apparent. After 8 years, dry bulk sentiment finally collapsed and bulker orders fell from 16m dwt in January 2014 to 0.05m dwt in June 2015. A helpful step towards market recovery, but it leaves the shipyards with a problem. Over the last 8 years bulkers were a third of shipyard workload (see inset pie chart). Although tankers and container ships are still being ordered, they show no sign of filling the gap left by bulkers.
Dance Macabre
So there you have it. Bulkers have finally made a meaningful move towards better times by cutting investment. But the game isn’t over yet. They still need a strong world economy and continued Chinese import growth. Meanwhile a new chess game with destiny is getting started, this time in the shipyards as they try to plug the bulker gap. Maybe the game’s not over yet. So if you want a nice relaxing summer, our advice is don’t watch The Seventh Seal.
Source: Clarksons | Hellenic Shipping News
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Monday, 24 August 15
IS CHINA'S STEEL EXPORTS ENOUGH TO SUPPORT THE FREIGHT MARKET? - BIMCO
No, it’s not enough, you will need lower Chinese iron ore production too in order to keep growing imports of iron ore into China that will su ...
Sunday, 23 August 15
SHIPPING FREIGHT RATES FALL SHARPLY ON EXCESS SUPPLY AND LOW DEMAND
COALspot.com: The BDI continued to soften and was down 5.78 pct and falls back below 1000 points this week.
The cape Index lost 17.25 per cent ...
Friday, 21 August 15
U.S. YEAR-TO-DATE COAL PRODUCTION VOLUME FALLS 8.7% Y-O-Y
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 18.3 million shor ...
Friday, 21 August 15
GLOBALCOAL TO LAUNCH ONLINE TRADING OF PHYSICAL MET COAL ON 13 OCTOBER
On 13 October 2015, globalCOAL will launch an online platform for the physical procurement and trade of high quality hard coking coal delivered FOB ...
Thursday, 20 August 15
COAL PRICES FALL TO 12-YEAR LOWS AS CHINA, INDIA JOIN DEMAND SLOWDOWN - REUTERS
Coal futures have fallen to 12-year lows, hit by soaring production and a slowdown in global buying, including from India and China which until rec ...
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- Bukit Baiduri Energy - Indonesia
- Renaissance Capital - South Africa
- GMR Energy Limited - India
- Kumho Petrochemical, South Korea
- Larsen & Toubro Limited - India
- CNBM International Corporation - China
- MS Steel International - UAE
- LBH Netherlands Bv - Netherlands
- Pendopo Energi Batubara - Indonesia
- Uttam Galva Steels Limited - India
- Wood Mackenzie - Singapore
- Central Electricity Authority - India
- Agrawal Coal Company - India
- Semirara Mining Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- Bhoruka Overseas - Indonesia
- Ambuja Cements Ltd - India
- Edison Trading Spa - Italy
- Sical Logistics Limited - India
- McConnell Dowell - Australia
- Oldendorff Carriers - Singapore
- Semirara Mining and Power Corporation, Philippines
- Dalmia Cement Bharat India
- TeaM Sual Corporation - Philippines
- Meralco Power Generation, Philippines
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- Leighton Contractors Pty Ltd - Australia
- South Luzon Thermal Energy Corporation
- Mercuria Energy - Indonesia
- Parliament of New Zealand
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- Thiess Contractors Indonesia
- Sinarmas Energy and Mining - Indonesia
- Bharathi Cement Corporation - India
- Ceylon Electricity Board - Sri Lanka
- PNOC Exploration Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Bangladesh Power Developement Board
- Directorate General of MIneral and Coal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Baramulti Group, Indonesia
- Indian Energy Exchange, India
- Chamber of Mines of South Africa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Georgia Ports Authority, United States
- Samtan Co., Ltd - South Korea
- Independent Power Producers Association of India
- IHS Mccloskey Coal Group - USA
- Bhushan Steel Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Meenaskhi Energy Private Limited - India
- Eastern Energy - Thailand
- Vizag Seaport Private Limited - India
- Ministry of Transport, Egypt
- The University of Queensland
- SMG Consultants - Indonesia
- Australian Coal Association
- The Treasury - Australian Government
- Indogreen Group - Indonesia
- Directorate Of Revenue Intelligence - India
- Commonwealth Bank - Australia
- Neyveli Lignite Corporation Ltd, - India
- Madhucon Powers Ltd - India
- The State Trading Corporation of India Ltd
- Grasim Industreis Ltd - India
- Star Paper Mills Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Barasentosa Lestari - Indonesia
- Eastern Coal Council - USA
- PetroVietnam Power Coal Import and Supply Company
- Lanco Infratech Ltd - India
- Essar Steel Hazira Ltd - India
- Gujarat Sidhee Cement - India
- Malabar Cements Ltd - India
- Minerals Council of Australia
- Karaikal Port Pvt Ltd - India
- Tata Chemicals Ltd - India
- Sree Jayajothi Cements Limited - India
- Vedanta Resources Plc - India
- Binh Thuan Hamico - Vietnam
- Parry Sugars Refinery, India
- Central Java Power - Indonesia
- San Jose City I Power Corp, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Wilmar Investment Holdings
- Mercator Lines Limited - India
- Indo Tambangraya Megah - Indonesia
- Australian Commodity Traders Exchange
- Sindya Power Generating Company Private Ltd
- International Coal Ventures Pvt Ltd - India
- Heidelberg Cement - Germany
- Asmin Koalindo Tuhup - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Orica Australia Pty. Ltd.
- Ind-Barath Power Infra Limited - India
- Manunggal Multi Energi - Indonesia
- Coastal Gujarat Power Limited - India
- Merrill Lynch Commodities Europe
- Kobexindo Tractors - Indoneisa
- Mjunction Services Limited - India
- Xindia Steels Limited - India
- Rio Tinto Coal - Australia
- Coalindo Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Therma Luzon, Inc, Philippines
- London Commodity Brokers - England
- VISA Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Deloitte Consulting - India
- Riau Bara Harum - Indonesia
- Makarim & Taira - Indonesia
- Global Green Power PLC Corporation, Philippines
- PTC India Limited - India
- Antam Resourcindo - Indonesia
- IEA Clean Coal Centre - UK
- ASAPP Information Group - India
- Savvy Resources Ltd - HongKong
- Metalloyd Limited - United Kingdom
- Attock Cement Pakistan Limited
- Cement Manufacturers Association - India
- Sojitz Corporation - Japan
- Straits Asia Resources Limited - Singapore
- Orica Mining Services - Indonesia
- Global Business Power Corporation, Philippines
- India Bulls Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Kaltim Prima Coal - Indonesia
- Bulk Trading Sa - Switzerland
- Thai Mozambique Logistica
- Borneo Indobara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Tamil Nadu electricity Board
- SN Aboitiz Power Inc, Philippines
- Latin American Coal - Colombia
- Petron Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GAC Shipping (India) Pvt Ltd
- White Energy Company Limited
- Medco Energi Mining Internasional
- Kapuas Tunggal Persada - Indonesia
- Altura Mining Limited, Indonesia
- Port Waratah Coal Services - Australia
- Krishnapatnam Port Company Ltd. - India
- Electricity Authority, New Zealand
- Sakthi Sugars Limited - India
- European Bulk Services B.V. - Netherlands
- Trasteel International SA, Italy
- Jindal Steel & Power Ltd - India
- Toyota Tsusho Corporation, Japan
- Electricity Generating Authority of Thailand
- Indian Oil Corporation Limited
- CIMB Investment Bank - Malaysia
- Kartika Selabumi Mining - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Sarangani Energy Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Aboitiz Power Corporation - Philippines
- Energy Development Corp, Philippines
- Bhatia International Limited - India
- Intertek Mineral Services - Indonesia
- Videocon Industries ltd - India
- Maheswari Brothers Coal Limited - India
- Billiton Holdings Pty Ltd - Australia
- Coal and Oil Company - UAE
- Rashtriya Ispat Nigam Limited - India
- OPG Power Generation Pvt Ltd - India
- Africa Commodities Group - South Africa
- Anglo American - United Kingdom
- New Zealand Coal & Carbon
- Kepco SPC Power Corporation, Philippines
- Ministry of Mines - Canada
- Economic Council, Georgia
- TNB Fuel Sdn Bhd - Malaysia
- Pipit Mutiara Jaya. PT, Indonesia
- Posco Energy - South Korea
- SMC Global Power, Philippines
- Siam City Cement - Thailand
- Marubeni Corporation - India
- Timah Investasi Mineral - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Gujarat Mineral Development Corp Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Energy Link Ltd, New Zealand
- Interocean Group of Companies - India
- Aditya Birla Group - India
- Globalindo Alam Lestari - Indonesia
- PowerSource Philippines DevCo
- Singapore Mercantile Exchange
- Goldman Sachs - Singapore
- Salva Resources Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Jaiprakash Power Ventures ltd
- Indika Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Formosa Plastics Group - Taiwan
- Banpu Public Company Limited - Thailand
- Planning Commission, India
- Siam City Cement PLC, Thailand
- Global Coal Blending Company Limited - Australia
- Gujarat Electricity Regulatory Commission - India
- Romanian Commodities Exchange
- Karbindo Abesyapradhi - Indoneisa
- Holcim Trading Pte Ltd - Singapore
- Carbofer General Trading SA - India
- Indonesian Coal Mining Association
- GN Power Mariveles Coal Plant, Philippines
- Standard Chartered Bank - UAE
- Ministry of Finance - Indonesia
- Power Finance Corporation Ltd., India
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