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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, 12 July 15
SHIPYARD NOT LIABLE FOR ENGINE ROOM FIRE CAUSED BY OIL LEAKAGE - BIRCH WINDAHL
KNOWLEDGE TO ELEVATE
A Danish vessel owner requested a Danish shipyard to undertake repairs and maintenance works on its vessel. An agreement ...
Saturday, 11 July 15
MAJOR IRANIAN GAS EXPORTS WILL TAKE AT LEAST FIVE YEARS - FITCH
Iran has the long-term potential to become one of the world's top gas producers, thanks to its 34 trillion cubic meters (tcm) of natural gas re ...
Friday, 10 July 15
DRY BULK MARKET KEEPS POSITIVE MOMENTUM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept its positive momentum over the course of the past few days, thanks to Panamax gains. During yesterday’s session ...
Friday, 10 July 15
U.S PRODUCED APPROXIMATELY TOTALED AN ESTIMATED 14.1 MMST WEEK OVER WEEK - EIA
COALspot.com – United States the second largest coal producer in the world has produced approximately totaled an estimated 14.1 million short ...
Thursday, 09 July 15
CPP MARKET : POSITIVE IN THE SHORT TERM - GEORGE VASTARDIS
Despite the traditionally quieter summer period, the clean tanker market has so far experienced healthy activity especially East of Suez. Increased ...
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- PTC India Limited - India
- Binh Thuan Hamico - Vietnam
- Kaltim Prima Coal - Indonesia
- SMG Consultants - Indonesia
- Gujarat Sidhee Cement - India
- Energy Development Corp, Philippines
- The Treasury - Australian Government
- Videocon Industries ltd - India
- Agrawal Coal Company - India
- Edison Trading Spa - Italy
- TeaM Sual Corporation - Philippines
- CNBM International Corporation - China
- Australian Commodity Traders Exchange
- Attock Cement Pakistan Limited
- Vedanta Resources Plc - India
- Medco Energi Mining Internasional
- Bukit Asam (Persero) Tbk - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Global Business Power Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Electricity Authority, New Zealand
- Asmin Koalindo Tuhup - Indonesia
- The State Trading Corporation of India Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Ind-Barath Power Infra Limited - India
- European Bulk Services B.V. - Netherlands
- Uttam Galva Steels Limited - India
- ICICI Bank Limited - India
- GMR Energy Limited - India
- Intertek Mineral Services - Indonesia
- Simpson Spence & Young - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Cigading International Bulk Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- Malabar Cements Ltd - India
- Renaissance Capital - South Africa
- AsiaOL BioFuels Corp., Philippines
- Indonesian Coal Mining Association
- LBH Netherlands Bv - Netherlands
- The University of Queensland
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indo Tambangraya Megah - Indonesia
- Krishnapatnam Port Company Ltd. - India
- PNOC Exploration Corporation - Philippines
- Orica Australia Pty. Ltd.
- SMC Global Power, Philippines
- Madhucon Powers Ltd - India
- Maheswari Brothers Coal Limited - India
- Pendopo Energi Batubara - Indonesia
- Straits Asia Resources Limited - Singapore
- Mintek Dendrill Indonesia
- Coal and Oil Company - UAE
- McConnell Dowell - Australia
- Oldendorff Carriers - Singapore
- Chamber of Mines of South Africa
- Sical Logistics Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Coalindo Energy - Indonesia
- New Zealand Coal & Carbon
- Sinarmas Energy and Mining - Indonesia
- Siam City Cement PLC, Thailand
- Georgia Ports Authority, United States
- Metalloyd Limited - United Kingdom
- Heidelberg Cement - Germany
- Electricity Generating Authority of Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Planning Commission, India
- Salva Resources Pvt Ltd - India
- Australian Coal Association
- Merrill Lynch Commodities Europe
- Port Waratah Coal Services - Australia
- Posco Energy - South Korea
- Eastern Coal Council - USA
- Kobexindo Tractors - Indoneisa
- Ministry of Mines - Canada
- GAC Shipping (India) Pvt Ltd
- San Jose City I Power Corp, Philippines
- Bharathi Cement Corporation - India
- Billiton Holdings Pty Ltd - Australia
- Kapuas Tunggal Persada - Indonesia
- Samtan Co., Ltd - South Korea
- Anglo American - United Kingdom
- Sree Jayajothi Cements Limited - India
- ASAPP Information Group - India
- Semirara Mining Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indika Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Tata Chemicals Ltd - India
- Essar Steel Hazira Ltd - India
- Interocean Group of Companies - India
- Banpu Public Company Limited - Thailand
- Thiess Contractors Indonesia
- Bhatia International Limited - India
- Aditya Birla Group - India
- PowerSource Philippines DevCo
- Orica Mining Services - Indonesia
- Latin American Coal - Colombia
- Ministry of Finance - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Goldman Sachs - Singapore
- GVK Power & Infra Limited - India
- IEA Clean Coal Centre - UK
- Bukit Makmur.PT - Indonesia
- Xindia Steels Limited - India
- Africa Commodities Group - South Africa
- Global Green Power PLC Corporation, Philippines
- Central Java Power - Indonesia
- Parry Sugars Refinery, India
- Bhushan Steel Limited - India
- London Commodity Brokers - England
- Vizag Seaport Private Limited - India
- Lanco Infratech Ltd - India
- Borneo Indobara - Indonesia
- Altura Mining Limited, Indonesia
- Jindal Steel & Power Ltd - India
- Savvy Resources Ltd - HongKong
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Carbofer General Trading SA - India
- Bulk Trading Sa - Switzerland
- Manunggal Multi Energi - Indonesia
- Larsen & Toubro Limited - India
- Sindya Power Generating Company Private Ltd
- Iligan Light & Power Inc, Philippines
- Kumho Petrochemical, South Korea
- Gujarat Mineral Development Corp Ltd - India
- Meralco Power Generation, Philippines
- Central Electricity Authority - India
- Karbindo Abesyapradhi - Indoneisa
- Barasentosa Lestari - Indonesia
- Grasim Industreis Ltd - India
- Petron Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Timah Investasi Mineral - Indoneisa
- Mercator Lines Limited - India
- Kepco SPC Power Corporation, Philippines
- Sojitz Corporation - Japan
- Gujarat Electricity Regulatory Commission - India
- Kartika Selabumi Mining - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Mercuria Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Rio Tinto Coal - Australia
- Ceylon Electricity Board - Sri Lanka
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indian Energy Exchange, India
- Mjunction Services Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Aboitiz Power Corporation - Philippines
- International Coal Ventures Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Siam City Cement - Thailand
- CIMB Investment Bank - Malaysia
- Karaikal Port Pvt Ltd - India
- Baramulti Group, Indonesia
- Chettinad Cement Corporation Ltd - India
- Trasteel International SA, Italy
- TNB Fuel Sdn Bhd - Malaysia
- Petrochimia International Co. Ltd.- Taiwan
- South Luzon Thermal Energy Corporation
- Miang Besar Coal Terminal - Indonesia
- Makarim & Taira - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Thai Mozambique Logistica
- Star Paper Mills Limited - India
- Sarangani Energy Corporation, Philippines
- Deloitte Consulting - India
- OPG Power Generation Pvt Ltd - India
- Eastern Energy - Thailand
- Directorate Of Revenue Intelligence - India
- Wilmar Investment Holdings
- Neyveli Lignite Corporation Ltd, - India
- Singapore Mercantile Exchange
- Parliament of New Zealand
- Riau Bara Harum - Indonesia
- MS Steel International - UAE
- Cement Manufacturers Association - India
- Kohat Cement Company Ltd. - Pakistan
- Globalindo Alam Lestari - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Dalmia Cement Bharat India
- Indian Oil Corporation Limited
- Tamil Nadu electricity Board
- Alfred C Toepfer International GmbH - Germany
- Vijayanagar Sugar Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- Kalimantan Lumbung Energi - Indonesia
- Marubeni Corporation - India
- India Bulls Power Limited - India
- Standard Chartered Bank - UAE
- Romanian Commodities Exchange
- Therma Luzon, Inc, Philippines
- Sakthi Sugars Limited - India
- VISA Power Limited - India
- Indogreen Group - Indonesia
- Independent Power Producers Association of India
- Meenaskhi Energy Private Limited - India
- Bhoruka Overseas - Indonesia
- Energy Link Ltd, New Zealand
- Minerals Council of Australia
- Jaiprakash Power Ventures ltd
- Economic Council, Georgia
- SN Aboitiz Power Inc, Philippines
- Ministry of Transport, Egypt
- Rashtriya Ispat Nigam Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Wood Mackenzie - Singapore
- Ambuja Cements Ltd - India
- Coastal Gujarat Power Limited - India
- White Energy Company Limited
- Commonwealth Bank - Australia
- Toyota Tsusho Corporation, Japan
- Antam Resourcindo - Indonesia
- Price Waterhouse Coopers - Russia
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