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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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Wednesday, 20 May 15
FOB RICHARDS BAY COAL SWAPS GAINED M-O-M, W-O-W
COALspot.com: API4 FOB Richards Bay Coal swap for delivery Q3' 2015 increased month over month and week over week.
The Q3 swap has increas ...
Wednesday, 20 May 15
BUKIT ASAM'S AVERAGE EXPORT PRICE WAS UNDER PRESSURE DURING Q1
COALspot.com: Indonesia’s state owned coal producer saw their profits fall in the first quarter of the year compared to the same period last ...
Wednesday, 20 May 15
IRON ORE PRICES TO REMAIN WEAK ON LOW DEMAND, HIGH OUTPUT - FITCH
Iron ore prices will stay low for several years due to increasing supply, weak demand growth in China and the slower-than-expected closure of high- ...
Tuesday, 19 May 15
KOMIPO IS SEEKING TOTAL 2.34 MMT OF HCV AND LCV COAL FOR 2015 - 2017
COALspot.com: South Korean state-owned utility Korea Midland Power (KOMIPO) issued an new tender to buy total 2.34 million Metric Tons (MT) of HCV ...
Monday, 18 May 15
FOB NEWCASTLE COAL SWAPS SCORE MONTHLY GAINS
COALspot.com: API 5 FOB Newcastle Coal swap for Q3’ 2015 delivery gained US$ 0.87 per MT (1.99%) month over month and lost US$ 0.03 week on w ...
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- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Karaikal Port Pvt Ltd - India
- Anglo American - United Kingdom
- Banpu Public Company Limited - Thailand
- Altura Mining Limited, Indonesia
- Salva Resources Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- Gujarat Mineral Development Corp Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Singapore Mercantile Exchange
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- Port Waratah Coal Services - Australia
- Global Business Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- Sical Logistics Limited - India
- SMC Global Power, Philippines
- Energy Link Ltd, New Zealand
- Chettinad Cement Corporation Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Kalimantan Lumbung Energi - Indonesia
- London Commodity Brokers - England
- Vedanta Resources Plc - India
- Leighton Contractors Pty Ltd - Australia
- Indonesian Coal Mining Association
- Bulk Trading Sa - Switzerland
- Electricity Generating Authority of Thailand
- Ministry of Transport, Egypt
- GMR Energy Limited - India
- Australian Commodity Traders Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Kepco SPC Power Corporation, Philippines
- Videocon Industries ltd - India
- Gujarat Sidhee Cement - India
- Antam Resourcindo - Indonesia
- GAC Shipping (India) Pvt Ltd
- Meenaskhi Energy Private Limited - India
- Marubeni Corporation - India
- SMG Consultants - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Coastal Gujarat Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- India Bulls Power Limited - India
- Bayan Resources Tbk. - Indonesia
- Kideco Jaya Agung - Indonesia
- Makarim & Taira - Indonesia
- Sojitz Corporation - Japan
- The State Trading Corporation of India Ltd
- Gujarat Electricity Regulatory Commission - India
- Energy Development Corp, Philippines
- White Energy Company Limited
- Billiton Holdings Pty Ltd - Australia
- Savvy Resources Ltd - HongKong
- Petron Corporation, Philippines
- Lanco Infratech Ltd - India
- Barasentosa Lestari - Indonesia
- Bangladesh Power Developement Board
- OPG Power Generation Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Globalindo Alam Lestari - Indonesia
- Agrawal Coal Company - India
- Bahari Cakrawala Sebuku - Indonesia
- Georgia Ports Authority, United States
- Kaltim Prima Coal - Indonesia
- Planning Commission, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- IEA Clean Coal Centre - UK
- Sree Jayajothi Cements Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Larsen & Toubro Limited - India
- International Coal Ventures Pvt Ltd - India
- Tamil Nadu electricity Board
- Grasim Industreis Ltd - India
- Sindya Power Generating Company Private Ltd
- Africa Commodities Group - South Africa
- Indian Oil Corporation Limited
- Ambuja Cements Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Power Finance Corporation Ltd., India
- Wood Mackenzie - Singapore
- Global Green Power PLC Corporation, Philippines
- Indogreen Group - Indonesia
- Deloitte Consulting - India
- Sakthi Sugars Limited - India
- Jindal Steel & Power Ltd - India
- The University of Queensland
- Romanian Commodities Exchange
- PNOC Exploration Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Siam City Cement PLC, Thailand
- Aboitiz Power Corporation - Philippines
- PetroVietnam Power Coal Import and Supply Company
- European Bulk Services B.V. - Netherlands
- CNBM International Corporation - China
- Miang Besar Coal Terminal - Indonesia
- Meralco Power Generation, Philippines
- VISA Power Limited - India
- The Treasury - Australian Government
- Uttam Galva Steels Limited - India
- Carbofer General Trading SA - India
- Xindia Steels Limited - India
- Siam City Cement - Thailand
- Intertek Mineral Services - Indonesia
- Ministry of Finance - Indonesia
- Bhushan Steel Limited - India
- Semirara Mining and Power Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Aditya Birla Group - India
- Dalmia Cement Bharat India
- Pendopo Energi Batubara - Indonesia
- Malabar Cements Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Bhatia International Limited - India
- Kartika Selabumi Mining - Indonesia
- Baramulti Group, Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Eastern Energy - Thailand
- IHS Mccloskey Coal Group - USA
- Mercuria Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Pipit Mutiara Jaya. PT, Indonesia
- Goldman Sachs - Singapore
- Renaissance Capital - South Africa
- Oldendorff Carriers - Singapore
- Maheswari Brothers Coal Limited - India
- Krishnapatnam Port Company Ltd. - India
- Star Paper Mills Limited - India
- Posco Energy - South Korea
- ASAPP Information Group - India
- Directorate General of MIneral and Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Wilmar Investment Holdings
- Essar Steel Hazira Ltd - India
- Borneo Indobara - Indonesia
- Merrill Lynch Commodities Europe
- Trasteel International SA, Italy
- Cement Manufacturers Association - India
- Independent Power Producers Association of India
- Medco Energi Mining Internasional
- Semirara Mining Corp, Philippines
- Coalindo Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- PowerSource Philippines DevCo
- Parliament of New Zealand
- Rio Tinto Coal - Australia
- Standard Chartered Bank - UAE
- South Luzon Thermal Energy Corporation
- Ministry of Mines - Canada
- Mintek Dendrill Indonesia
- Mjunction Services Limited - India
- Samtan Co., Ltd - South Korea
- Orica Australia Pty. Ltd.
- Mercator Lines Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Latin American Coal - Colombia
- Indika Energy - Indonesia
- McConnell Dowell - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Jaiprakash Power Ventures ltd
- Bukit Baiduri Energy - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Holcim Trading Pte Ltd - Singapore
- Coal and Oil Company - UAE
- New Zealand Coal & Carbon
- Indo Tambangraya Megah - Indonesia
- Commonwealth Bank - Australia
- Toyota Tsusho Corporation, Japan
- TeaM Sual Corporation - Philippines
- Madhucon Powers Ltd - India
- Ind-Barath Power Infra Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Minerals Council of Australia
- Iligan Light & Power Inc, Philippines
- Vizag Seaport Private Limited - India
- Heidelberg Cement - Germany
- Attock Cement Pakistan Limited
- Bhoruka Overseas - Indonesia
- Economic Council, Georgia
- LBH Netherlands Bv - Netherlands
- Straits Asia Resources Limited - Singapore
- PTC India Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Simpson Spence & Young - Indonesia
- Tata Chemicals Ltd - India
- Metalloyd Limited - United Kingdom
- Bharathi Cement Corporation - India
- Edison Trading Spa - Italy
- Binh Thuan Hamico - Vietnam
- Directorate Of Revenue Intelligence - India
- Timah Investasi Mineral - Indoneisa
- Chamber of Mines of South Africa
- Indian Energy Exchange, India
- Eastern Coal Council - USA
- Interocean Group of Companies - India
- Orica Mining Services - Indonesia
- Thiess Contractors Indonesia
- Sarangani Energy Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Parry Sugars Refinery, India
- Kobexindo Tractors - Indoneisa
- MS Steel International - UAE
- Cigading International Bulk Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Kumho Petrochemical, South Korea
- GVK Power & Infra Limited - India
- Bukit Makmur.PT - Indonesia
- ICICI Bank Limited - India
- Central Java Power - Indonesia
- Thai Mozambique Logistica
- Central Electricity Authority - India
- Price Waterhouse Coopers - Russia
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