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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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Friday, 22 May 15
U.S WEEKLY COAL PRODUCTION STAYS FLAT AT 16 MMST
COALspot.com – United States the second largest coal producer in the world has produced approximately totaled an estimated 16.0 million short ...
Thursday, 21 May 15
PORT OF NEWCASTLE ACHIEVED ITS BEST EVER TOTAL COAL EXPORT TURNOVER OF 159 MILLION TONS IN 2014
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port, has shipped $900 million ...
Thursday, 21 May 15
ATLANTIC PANAMAX MARKET STARTED TO IMPROVE SLOWLY - INTERMODAL
COALspot.com: The Dry Bulk market closed off the week on the green last week, purely on the back of improved Capesize performance, while the rest o ...
Wednesday, 20 May 15
LOWER PRICES SEEN IN NEWBUILDING MARKET ON LOW DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Cash-rich ship owners, or at least, owners with substantial access to financing will be among the prime candidates, who will reap the benefits of t ...
Wednesday, 20 May 15
TANKER MARKET INSIGHT - JOHN N. COTZIAS
Since Early October 2014 the tanker market has been experiencing a very positive momentum and has continued its strong performance so far in 2015. ...
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- Marubeni Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kumho Petrochemical, South Korea
- Manunggal Multi Energi - Indonesia
- Electricity Authority, New Zealand
- MS Steel International - UAE
- Bhoruka Overseas - Indonesia
- OPG Power Generation Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Maharashtra Electricity Regulatory Commission - India
- International Coal Ventures Pvt Ltd - India
- Planning Commission, India
- Vedanta Resources Plc - India
- Mercuria Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kalimantan Lumbung Energi - Indonesia
- Oldendorff Carriers - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Parry Sugars Refinery, India
- Krishnapatnam Port Company Ltd. - India
- Cigading International Bulk Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Eastern Energy - Thailand
- Makarim & Taira - Indonesia
- Ambuja Cements Ltd - India
- Bharathi Cement Corporation - India
- Barasentosa Lestari - Indonesia
- Semirara Mining Corp, Philippines
- Simpson Spence & Young - Indonesia
- GVK Power & Infra Limited - India
- Kapuas Tunggal Persada - Indonesia
- Bukit Baiduri Energy - Indonesia
- Interocean Group of Companies - India
- Standard Chartered Bank - UAE
- IEA Clean Coal Centre - UK
- Power Finance Corporation Ltd., India
- White Energy Company Limited
- Ministry of Finance - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Pendopo Energi Batubara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Renaissance Capital - South Africa
- Port Waratah Coal Services - Australia
- Aboitiz Power Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Eastern Coal Council - USA
- Global Green Power PLC Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Wood Mackenzie - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Siam City Cement - Thailand
- Chettinad Cement Corporation Ltd - India
- The Treasury - Australian Government
- Australian Coal Association
- Banpu Public Company Limited - Thailand
- Wilmar Investment Holdings
- Jorong Barutama Greston.PT - Indonesia
- Sarangani Energy Corporation, Philippines
- Ministry of Transport, Egypt
- Georgia Ports Authority, United States
- Merrill Lynch Commodities Europe
- Straits Asia Resources Limited - Singapore
- Attock Cement Pakistan Limited
- Coalindo Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Meralco Power Generation, Philippines
- Savvy Resources Ltd - HongKong
- Jaiprakash Power Ventures ltd
- Siam City Cement PLC, Thailand
- India Bulls Power Limited - India
- Kartika Selabumi Mining - Indonesia
- McConnell Dowell - Australia
- Posco Energy - South Korea
- Indian Oil Corporation Limited
- Star Paper Mills Limited - India
- Mercator Lines Limited - India
- Energy Development Corp, Philippines
- Global Coal Blending Company Limited - Australia
- PetroVietnam Power Coal Import and Supply Company
- Alfred C Toepfer International GmbH - Germany
- Therma Luzon, Inc, Philippines
- Metalloyd Limited - United Kingdom
- Australian Commodity Traders Exchange
- Kohat Cement Company Ltd. - Pakistan
- Sree Jayajothi Cements Limited - India
- Deloitte Consulting - India
- Altura Mining Limited, Indonesia
- Dalmia Cement Bharat India
- Sinarmas Energy and Mining - Indonesia
- Toyota Tsusho Corporation, Japan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- The University of Queensland
- Billiton Holdings Pty Ltd - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Parliament of New Zealand
- Timah Investasi Mineral - Indoneisa
- GMR Energy Limited - India
- Bhatia International Limited - India
- New Zealand Coal & Carbon
- Global Business Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Kobexindo Tractors - Indoneisa
- Price Waterhouse Coopers - Russia
- Larsen & Toubro Limited - India
- Sojitz Corporation - Japan
- Rio Tinto Coal - Australia
- ASAPP Information Group - India
- Indika Energy - Indonesia
- Mintek Dendrill Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Uttam Galva Steels Limited - India
- Aditya Birla Group - India
- Ind-Barath Power Infra Limited - India
- Xindia Steels Limited - India
- Minerals Council of Australia
- Thiess Contractors Indonesia
- Medco Energi Mining Internasional
- TNB Fuel Sdn Bhd - Malaysia
- Maheswari Brothers Coal Limited - India
- CNBM International Corporation - China
- Coal and Oil Company - UAE
- Vizag Seaport Private Limited - India
- Lanco Infratech Ltd - India
- Trasteel International SA, Italy
- London Commodity Brokers - England
- TeaM Sual Corporation - Philippines
- Madhucon Powers Ltd - India
- Tamil Nadu electricity Board
- Ceylon Electricity Board - Sri Lanka
- Latin American Coal - Colombia
- Commonwealth Bank - Australia
- Antam Resourcindo - Indonesia
- Heidelberg Cement - Germany
- Bulk Trading Sa - Switzerland
- LBH Netherlands Bv - Netherlands
- CIMB Investment Bank - Malaysia
- Central Electricity Authority - India
- Kaltim Prima Coal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Romanian Commodities Exchange
- Tata Chemicals Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Karaikal Port Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meenaskhi Energy Private Limited - India
- Directorate General of MIneral and Coal - Indonesia
- PowerSource Philippines DevCo
- Binh Thuan Hamico - Vietnam
- Kideco Jaya Agung - Indonesia
- ICICI Bank Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Bhushan Steel Limited - India
- Directorate Of Revenue Intelligence - India
- GN Power Mariveles Coal Plant, Philippines
- Agrawal Coal Company - India
- Central Java Power - Indonesia
- Sindya Power Generating Company Private Ltd
- Kepco SPC Power Corporation, Philippines
- Indian Energy Exchange, India
- Cement Manufacturers Association - India
- IHS Mccloskey Coal Group - USA
- SMG Consultants - Indonesia
- Samtan Co., Ltd - South Korea
- VISA Power Limited - India
- Holcim Trading Pte Ltd - Singapore
- Malabar Cements Ltd - India
- Videocon Industries ltd - India
- Independent Power Producers Association of India
- Coastal Gujarat Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Gujarat Sidhee Cement - India
- Bayan Resources Tbk. - Indonesia
- South Luzon Thermal Energy Corporation
- European Bulk Services B.V. - Netherlands
- Riau Bara Harum - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Petron Corporation, Philippines
- Grasim Industreis Ltd - India
- Edison Trading Spa - Italy
- PTC India Limited - India
- Electricity Generating Authority of Thailand
- Formosa Plastics Group - Taiwan
- Borneo Indobara - Indonesia
- PNOC Exploration Corporation - Philippines
- Africa Commodities Group - South Africa
- Bangladesh Power Developement Board
- Rashtriya Ispat Nigam Limited - India
- Indogreen Group - Indonesia
- Orica Mining Services - Indonesia
- SMC Global Power, Philippines
- Essar Steel Hazira Ltd - India
- Globalindo Alam Lestari - Indonesia
- Mjunction Services Limited - India
- Orica Australia Pty. Ltd.
- San Jose City I Power Corp, Philippines
- Chamber of Mines of South Africa
- Economic Council, Georgia
- Sakthi Sugars Limited - India
- Leighton Contractors Pty Ltd - Australia
- Jindal Steel & Power Ltd - India
- Carbofer General Trading SA - India
- Ministry of Mines - Canada
- Anglo American - United Kingdom
- Bukit Makmur.PT - Indonesia
- Salva Resources Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Goldman Sachs - Singapore
- Baramulti Group, Indonesia
- Iligan Light & Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Indonesian Coal Mining Association
- Sical Logistics Limited - India
- Thai Mozambique Logistica
- Singapore Mercantile Exchange
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