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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, 06 May 15
COMBINATION OF HOLIDAYS AND A SHAKY MARKET PUT ADDITIONAL PRESSURE ON RATES
COALspot.com: The combination of holidays and a shaky market is always a recipe for additional pressure on rates and last week was no exception. Wi ...
Wednesday, 06 May 15
SHIPPING MARKET INSIGHT - GEORGE ILIOPOULOS
The first four months of 2015 are now behind us and they make up for a decent amount of time to look back and assess how the year is evolving so fa ...
Tuesday, 05 May 15
MIFA BERSAUDARA UNIT OF ABM INVESTAMA STARTS OPERATING $200M COAL MINE IN ACEH
Reswara Minergi Hartama, a coal mining unit of coal miner ABM Investama known as known as Reswara, inaugurated a $200 million integrated coal minin ...
Tuesday, 05 May 15
FREIGHT DERIVATIVE VOLUMES REACHED TOTALED 14,154 CONTRACTS IN APRIL - SGX
COALspot.com: “Our unique suite of freight and bulk commodity products provides market participants with a wide range of trading strategies a ...
Tuesday, 05 May 15
OVERSUPPLY PUTTING INDONESIAN COAL PRICES UNDER PRESSURE
COALspot.com: Indonesian coal swap for delivery Q3 2015 lost week over week and month on month, this past week.
The Q3 swap was declined US$ 1 ...
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- Tamil Nadu electricity Board
- Australian Coal Association
- Videocon Industries ltd - India
- Tata Chemicals Ltd - India
- Georgia Ports Authority, United States
- Mercator Lines Limited - India
- Indo Tambangraya Megah - Indonesia
- Globalindo Alam Lestari - Indonesia
- Indonesian Coal Mining Association
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Essar Steel Hazira Ltd - India
- TeaM Sual Corporation - Philippines
- Chamber of Mines of South Africa
- Straits Asia Resources Limited - Singapore
- GMR Energy Limited - India
- Attock Cement Pakistan Limited
- San Jose City I Power Corp, Philippines
- Directorate Of Revenue Intelligence - India
- Altura Mining Limited, Indonesia
- Jindal Steel & Power Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Baramulti Group, Indonesia
- Mercuria Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Meenaskhi Energy Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Intertek Mineral Services - Indonesia
- Port Waratah Coal Services - Australia
- Vedanta Resources Plc - India
- Karaikal Port Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- MS Steel International - UAE
- Cement Manufacturers Association - India
- Sojitz Corporation - Japan
- Indika Energy - Indonesia
- Energy Development Corp, Philippines
- SMC Global Power, Philippines
- Bangladesh Power Developement Board
- TNB Fuel Sdn Bhd - Malaysia
- SN Aboitiz Power Inc, Philippines
- GVK Power & Infra Limited - India
- Orica Australia Pty. Ltd.
- Bukit Asam (Persero) Tbk - Indonesia
- Marubeni Corporation - India
- Sakthi Sugars Limited - India
- Kapuas Tunggal Persada - Indonesia
- Bukit Baiduri Energy - Indonesia
- Sindya Power Generating Company Private Ltd
- Sical Logistics Limited - India
- CIMB Investment Bank - Malaysia
- Bhatia International Limited - India
- Iligan Light & Power Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Transport, Egypt
- Sarangani Energy Corporation, Philippines
- Thiess Contractors Indonesia
- PowerSource Philippines DevCo
- The State Trading Corporation of India Ltd
- Aditya Birla Group - India
- Riau Bara Harum - Indonesia
- European Bulk Services B.V. - Netherlands
- Vijayanagar Sugar Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Uttam Galva Steels Limited - India
- Barasentosa Lestari - Indonesia
- Indian Energy Exchange, India
- Kartika Selabumi Mining - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meralco Power Generation, Philippines
- The Treasury - Australian Government
- Ind-Barath Power Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- Edison Trading Spa - Italy
- Petrochimia International Co. Ltd.- Taiwan
- GAC Shipping (India) Pvt Ltd
- Central Electricity Authority - India
- Antam Resourcindo - Indonesia
- IHS Mccloskey Coal Group - USA
- Kideco Jaya Agung - Indonesia
- Mjunction Services Limited - India
- Global Coal Blending Company Limited - Australia
- Jorong Barutama Greston.PT - Indonesia
- Latin American Coal - Colombia
- Gujarat Mineral Development Corp Ltd - India
- Indogreen Group - Indonesia
- PTC India Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Agrawal Coal Company - India
- Parry Sugars Refinery, India
- Savvy Resources Ltd - HongKong
- Leighton Contractors Pty Ltd - Australia
- Siam City Cement - Thailand
- IEA Clean Coal Centre - UK
- Africa Commodities Group - South Africa
- Wilmar Investment Holdings
- Planning Commission, India
- SMG Consultants - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Metalloyd Limited - United Kingdom
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Jaiprakash Power Ventures ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Deloitte Consulting - India
- London Commodity Brokers - England
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhoruka Overseas - Indonesia
- Malabar Cements Ltd - India
- Borneo Indobara - Indonesia
- VISA Power Limited - India
- Coalindo Energy - Indonesia
- LBH Netherlands Bv - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- PNOC Exploration Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- India Bulls Power Limited - India
- Renaissance Capital - South Africa
- Star Paper Mills Limited - India
- Semirara Mining and Power Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Binh Thuan Hamico - Vietnam
- Timah Investasi Mineral - Indoneisa
- Minerals Council of Australia
- Kumho Petrochemical, South Korea
- CNBM International Corporation - China
- Maharashtra Electricity Regulatory Commission - India
- Carbofer General Trading SA - India
- Standard Chartered Bank - UAE
- Makarim & Taira - Indonesia
- International Coal Ventures Pvt Ltd - India
- The University of Queensland
- Ministry of Finance - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Mintek Dendrill Indonesia
- Merrill Lynch Commodities Europe
- Kalimantan Lumbung Energi - Indonesia
- Medco Energi Mining Internasional
- Bulk Trading Sa - Switzerland
- Romanian Commodities Exchange
- Krishnapatnam Port Company Ltd. - India
- Ministry of Mines - Canada
- Global Green Power PLC Corporation, Philippines
- Petron Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Central Java Power - Indonesia
- Rio Tinto Coal - Australia
- Independent Power Producers Association of India
- Australian Commodity Traders Exchange
- Grasim Industreis Ltd - India
- Vizag Seaport Private Limited - India
- Coastal Gujarat Power Limited - India
- Eastern Coal Council - USA
- Cigading International Bulk Terminal - Indonesia
- Thai Mozambique Logistica
- Power Finance Corporation Ltd., India
- ICICI Bank Limited - India
- Semirara Mining Corp, Philippines
- Formosa Plastics Group - Taiwan
- Wood Mackenzie - Singapore
- McConnell Dowell - Australia
- Kepco SPC Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Economic Council, Georgia
- Kohat Cement Company Ltd. - Pakistan
- Indian Oil Corporation Limited
- Dalmia Cement Bharat India
- Goldman Sachs - Singapore
- Larsen & Toubro Limited - India
- New Zealand Coal & Carbon
- Gujarat Electricity Regulatory Commission - India
- Orica Mining Services - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Lanco Infratech Ltd - India
- Gujarat Sidhee Cement - India
- Bhushan Steel Limited - India
- Posco Energy - South Korea
- Interocean Group of Companies - India
- Oldendorff Carriers - Singapore
- White Energy Company Limited
- Heidelberg Cement - Germany
- South Luzon Thermal Energy Corporation
- Pendopo Energi Batubara - Indonesia
- Trasteel International SA, Italy
- Commonwealth Bank - Australia
- Chettinad Cement Corporation Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Energy Link Ltd, New Zealand
- Anglo American - United Kingdom
- Electricity Generating Authority of Thailand
- Maheswari Brothers Coal Limited - India
- Bayan Resources Tbk. - Indonesia
- Parliament of New Zealand
- Coal and Oil Company - UAE
- Madhucon Powers Ltd - India
- Xindia Steels Limited - India
- Banpu Public Company Limited - Thailand
- PetroVietnam Power Coal Import and Supply Company
- Singapore Mercantile Exchange
- GN Power Mariveles Coal Plant, Philippines
- Salva Resources Pvt Ltd - India
- Eastern Energy - Thailand
- Miang Besar Coal Terminal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Global Business Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Electricity Authority, New Zealand
- Aboitiz Power Corporation - Philippines
- Bharathi Cement Corporation - India
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement PLC, Thailand
- Directorate General of MIneral and Coal - Indonesia
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