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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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Sunday, 19 July 15
BDI GAINED AND CROSSED 1000 MARK THIS WEEK
COALspot.com: The BDI gained and crossed 1000 mark after many months this Friday. The BDI was up almost 20 pct and closed 1048 points on 17 July 20 ...
Saturday, 18 July 15
INTERVIEW : FRANZ ESCALANTE, CHIEF OF INFORMATION SYSTEMS, MINERA CHINALCO, PERU
We are interested in the technology of Autonomous trucks, the new-generation trucks are not remote controlled, they are truly autonomous - Franz Es ...
Friday, 17 July 15
COAL PRODUCTION IN THE U.S. INCREASES SHARPLY FOR THE WEEK ENDING JULY 11
COALspot.com – United States the second largest coal producer in the world has produced approximately totaled an estimated 16.4 million short ...
Friday, 17 July 15
INDONESIAN POWER-STATION COAL SWAPS DECLINE CONTINUES THIS PAST WEEK
COALspot.com: Indonesian coal swap for delivery Q3 2015 declined month on month and week over week, this past week.
The Q3 swap was declined $ ...
Friday, 17 July 15
DO CANCELLATION RIGHTS UNDER VOYAGE CHARTERPARTY SURVIVE RE-NOMINATION OF LOAD PORT? - INCE&CO
KNOWLEDGE TO ELEVATE
Do cancellation rights under voyage charterparty survive re-nomination of load port?
St Shipping & Transport Inc ...
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- Salva Resources Pvt Ltd - India
- Economic Council, Georgia
- Posco Energy - South Korea
- Pendopo Energi Batubara - Indonesia
- SMG Consultants - Indonesia
- Coal and Oil Company - UAE
- Savvy Resources Ltd - HongKong
- Banpu Public Company Limited - Thailand
- International Coal Ventures Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Global Business Power Corporation, Philippines
- Sakthi Sugars Limited - India
- TeaM Sual Corporation - Philippines
- Romanian Commodities Exchange
- South Luzon Thermal Energy Corporation
- GVK Power & Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Lanco Infratech Ltd - India
- Meralco Power Generation, Philippines
- Coalindo Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- Meenaskhi Energy Private Limited - India
- Mercator Lines Limited - India
- Mjunction Services Limited - India
- Port Waratah Coal Services - Australia
- Asmin Koalindo Tuhup - Indonesia
- The Treasury - Australian Government
- Renaissance Capital - South Africa
- Indian Energy Exchange, India
- Singapore Mercantile Exchange
- ICICI Bank Limited - India
- Electricity Generating Authority of Thailand
- Vizag Seaport Private Limited - India
- Kobexindo Tractors - Indoneisa
- Pipit Mutiara Jaya. PT, Indonesia
- Energy Link Ltd, New Zealand
- VISA Power Limited - India
- Formosa Plastics Group - Taiwan
- Thai Mozambique Logistica
- Offshore Bulk Terminal Pte Ltd, Singapore
- The State Trading Corporation of India Ltd
- Jaiprakash Power Ventures ltd
- Larsen & Toubro Limited - India
- Latin American Coal - Colombia
- Videocon Industries ltd - India
- Electricity Authority, New Zealand
- Goldman Sachs - Singapore
- Bukit Baiduri Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- Riau Bara Harum - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Mercuria Energy - Indonesia
- Ministry of Finance - Indonesia
- Bayan Resources Tbk. - Indonesia
- Bukit Makmur.PT - Indonesia
- India Bulls Power Limited - India
- Independent Power Producers Association of India
- PTC India Limited - India
- Global Coal Blending Company Limited - Australia
- Kalimantan Lumbung Energi - Indonesia
- Binh Thuan Hamico - Vietnam
- Interocean Group of Companies - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bulk Trading Sa - Switzerland
- Bharathi Cement Corporation - India
- Parry Sugars Refinery, India
- Gujarat Sidhee Cement - India
- Toyota Tsusho Corporation, Japan
- Kapuas Tunggal Persada - Indonesia
- Sindya Power Generating Company Private Ltd
- CNBM International Corporation - China
- Maharashtra Electricity Regulatory Commission - India
- San Jose City I Power Corp, Philippines
- PowerSource Philippines DevCo
- Siam City Cement PLC, Thailand
- Anglo American - United Kingdom
- Maheswari Brothers Coal Limited - India
- Energy Development Corp, Philippines
- Karaikal Port Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Metalloyd Limited - United Kingdom
- Krishnapatnam Port Company Ltd. - India
- Rashtriya Ispat Nigam Limited - India
- Edison Trading Spa - Italy
- Baramulti Group, Indonesia
- Iligan Light & Power Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Directorate General of MIneral and Coal - Indonesia
- Bangladesh Power Developement Board
- McConnell Dowell - Australia
- Medco Energi Mining Internasional
- Chettinad Cement Corporation Ltd - India
- GAC Shipping (India) Pvt Ltd
- Kaltim Prima Coal - Indonesia
- IHS Mccloskey Coal Group - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Central Java Power - Indonesia
- Therma Luzon, Inc, Philippines
- Wilmar Investment Holdings
- ASAPP Information Group - India
- Chamber of Mines of South Africa
- Bahari Cakrawala Sebuku - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Altura Mining Limited, Indonesia
- European Bulk Services B.V. - Netherlands
- Australian Coal Association
- Semirara Mining and Power Corporation, Philippines
- London Commodity Brokers - England
- Ministry of Transport, Egypt
- Miang Besar Coal Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ministry of Mines - Canada
- Agrawal Coal Company - India
- Ceylon Electricity Board - Sri Lanka
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- Petron Corporation, Philippines
- Siam City Cement - Thailand
- Makarim & Taira - Indonesia
- Globalindo Alam Lestari - Indonesia
- Eastern Coal Council - USA
- Aboitiz Power Corporation - Philippines
- Dalmia Cement Bharat India
- SMC Global Power, Philippines
- Sojitz Corporation - Japan
- Kartika Selabumi Mining - Indonesia
- Vedanta Resources Plc - India
- Tata Chemicals Ltd - India
- Uttam Galva Steels Limited - India
- Coastal Gujarat Power Limited - India
- OPG Power Generation Pvt Ltd - India
- Minerals Council of Australia
- Tamil Nadu electricity Board
- Marubeni Corporation - India
- Essar Steel Hazira Ltd - India
- Jindal Steel & Power Ltd - India
- Kumho Petrochemical, South Korea
- Africa Commodities Group - South Africa
- Sree Jayajothi Cements Limited - India
- Barasentosa Lestari - Indonesia
- White Energy Company Limited
- Central Electricity Authority - India
- Planning Commission, India
- Alfred C Toepfer International GmbH - Germany
- Mintek Dendrill Indonesia
- Malabar Cements Ltd - India
- LBH Netherlands Bv - Netherlands
- Holcim Trading Pte Ltd - Singapore
- Thiess Contractors Indonesia
- Orica Australia Pty. Ltd.
- Sical Logistics Limited - India
- Parliament of New Zealand
- Ind-Barath Power Infra Limited - India
- Bhoruka Overseas - Indonesia
- Ambuja Cements Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Orica Mining Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Rio Tinto Coal - Australia
- Jorong Barutama Greston.PT - Indonesia
- Australian Commodity Traders Exchange
- Gujarat Mineral Development Corp Ltd - India
- Oldendorff Carriers - Singapore
- AsiaOL BioFuels Corp., Philippines
- Commonwealth Bank - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Power Finance Corporation Ltd., India
- Indika Energy - Indonesia
- Attock Cement Pakistan Limited
- Simpson Spence & Young - Indonesia
- Eastern Energy - Thailand
- Xindia Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Merrill Lynch Commodities Europe
- MS Steel International - UAE
- Indogreen Group - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Wood Mackenzie - Singapore
- Straits Asia Resources Limited - Singapore
- Cement Manufacturers Association - India
- Trasteel International SA, Italy
- Bhushan Steel Limited - India
- Georgia Ports Authority, United States
- Kohat Cement Company Ltd. - Pakistan
- Grasim Industreis Ltd - India
- The University of Queensland
- Sarangani Energy Corporation, Philippines
- Aditya Birla Group - India
- New Zealand Coal & Carbon
- Leighton Contractors Pty Ltd - Australia
- Kepco SPC Power Corporation, Philippines
- Madhucon Powers Ltd - India
- Kideco Jaya Agung - Indonesia
- Bhatia International Limited - India
- Star Paper Mills Limited - India
- Deloitte Consulting - India
- Petrochimia International Co. Ltd.- Taiwan
- Carbofer General Trading SA - India
- Standard Chartered Bank - UAE
- Intertek Mineral Services - Indonesia
- Antam Resourcindo - Indonesia
- Indonesian Coal Mining Association
- Heidelberg Cement - Germany
- Semirara Mining Corp, Philippines
- CIMB Investment Bank - Malaysia
- Karbindo Abesyapradhi - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Timah Investasi Mineral - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Borneo Indobara - Indonesia
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