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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, 24 April 15
IS INDIA THE 'NEW CHINA' WHEN IT COMES TO THE DRY BULK MARKET? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has been feeling the “heat” of China’s slowdown and together with the industry’s own failings, with ove ...
Friday, 24 April 15
GLOBAL STEEL PRODUCTION OUTSIDE OF CHINA CONTINUES TO FARE VERY POORLY - JEFFREY LANDSBERG
COALspot.com: Data released this week showed that global crude steel production totaled approximately 138.05 million tons in March.
Wha ...
Friday, 24 April 15
WEEKLY U.S. COAL PRODUCTION ESTIMATE FALLS 5.7% FROM LAST WEEK
COALspot.com – United States the second largest coal producer in the world has produced approximately totaled an estimated 17.0 million short ...
Wednesday, 22 April 15
PANAMAX : ATLANTIC HOLDING ON TO THE GAINS OF THE PREVIOUS WEEK; PACIFIC BUSINESS SLID QUIETLY
COALspot.com: The Dry Bulk market managed to close off the week on a positive note last Friday, while as opposed to what we have been used to, it w ...
Wednesday, 22 April 15
TANKER MARKET INSIGHT - STRATOS TINIAKOS
The current environment we experience as a result of low crude oil prices is characterized by the increased demand for petroleum products in OECD c ...
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- Jindal Steel & Power Ltd - India
- Commonwealth Bank - Australia
- International Coal Ventures Pvt Ltd - India
- Goldman Sachs - Singapore
- Planning Commission, India
- Indian Energy Exchange, India
- Bahari Cakrawala Sebuku - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Singapore Mercantile Exchange
- Indo Tambangraya Megah - Indonesia
- Parry Sugars Refinery, India
- Samtan Co., Ltd - South Korea
- Jaiprakash Power Ventures ltd
- Sakthi Sugars Limited - India
- San Jose City I Power Corp, Philippines
- Australian Coal Association
- PNOC Exploration Corporation - Philippines
- Mercuria Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Altura Mining Limited, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- IHS Mccloskey Coal Group - USA
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Java Power - Indonesia
- Edison Trading Spa - Italy
- Gujarat Sidhee Cement - India
- IEA Clean Coal Centre - UK
- TeaM Sual Corporation - Philippines
- Essar Steel Hazira Ltd - India
- Riau Bara Harum - Indonesia
- Ministry of Finance - Indonesia
- Pendopo Energi Batubara - Indonesia
- Larsen & Toubro Limited - India
- Bhoruka Overseas - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Sinarmas Energy and Mining - Indonesia
- Global Coal Blending Company Limited - Australia
- Directorate General of MIneral and Coal - Indonesia
- Madhucon Powers Ltd - India
- Wood Mackenzie - Singapore
- Metalloyd Limited - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- TNB Fuel Sdn Bhd - Malaysia
- LBH Netherlands Bv - Netherlands
- India Bulls Power Limited - India
- Ministry of Mines - Canada
- Mercator Lines Limited - India
- Mintek Dendrill Indonesia
- New Zealand Coal & Carbon
- Eastern Energy - Thailand
- Kumho Petrochemical, South Korea
- Africa Commodities Group - South Africa
- Minerals Council of Australia
- Energy Development Corp, Philippines
- CNBM International Corporation - China
- Semirara Mining Corp, Philippines
- Kepco SPC Power Corporation, Philippines
- Ministry of Transport, Egypt
- ASAPP Information Group - India
- Bukit Baiduri Energy - Indonesia
- Electricity Authority, New Zealand
- Savvy Resources Ltd - HongKong
- Barasentosa Lestari - Indonesia
- Indonesian Coal Mining Association
- Orica Mining Services - Indonesia
- Bulk Trading Sa - Switzerland
- Indian Oil Corporation Limited
- Siam City Cement - Thailand
- Uttam Galva Steels Limited - India
- Sree Jayajothi Cements Limited - India
- Bhushan Steel Limited - India
- Grasim Industreis Ltd - India
- Sojitz Corporation - Japan
- GVK Power & Infra Limited - India
- Ind-Barath Power Infra Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Kartika Selabumi Mining - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Energy Link Ltd, New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Tata Chemicals Ltd - India
- Global Green Power PLC Corporation, Philippines
- Romanian Commodities Exchange
- Simpson Spence & Young - Indonesia
- Baramulti Group, Indonesia
- Ceylon Electricity Board - Sri Lanka
- Mjunction Services Limited - India
- Interocean Group of Companies - India
- McConnell Dowell - Australia
- Iligan Light & Power Inc, Philippines
- Bharathi Cement Corporation - India
- Aditya Birla Group - India
- Gujarat Mineral Development Corp Ltd - India
- Coal and Oil Company - UAE
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Videocon Industries ltd - India
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- Jorong Barutama Greston.PT - Indonesia
- Antam Resourcindo - Indonesia
- Therma Luzon, Inc, Philippines
- Petron Corporation, Philippines
- Global Business Power Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- European Bulk Services B.V. - Netherlands
- Alfred C Toepfer International GmbH - Germany
- GN Power Mariveles Coal Plant, Philippines
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- Kapuas Tunggal Persada - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- White Energy Company Limited
- Rashtriya Ispat Nigam Limited - India
- Star Paper Mills Limited - India
- Miang Besar Coal Terminal - Indonesia
- Dalmia Cement Bharat India
- Kideco Jaya Agung - Indonesia
- Wilmar Investment Holdings
- Binh Thuan Hamico - Vietnam
- Kalimantan Lumbung Energi - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Thai Mozambique Logistica
- Salva Resources Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Heidelberg Cement - Germany
- SN Aboitiz Power Inc, Philippines
- Oldendorff Carriers - Singapore
- CIMB Investment Bank - Malaysia
- Cement Manufacturers Association - India
- Bukit Makmur.PT - Indonesia
- Carbofer General Trading SA - India
- Posco Energy - South Korea
- VISA Power Limited - India
- Timah Investasi Mineral - Indoneisa
- SMC Global Power, Philippines
- Coalindo Energy - Indonesia
- Economic Council, Georgia
- Power Finance Corporation Ltd., India
- Xindia Steels Limited - India
- Kaltim Prima Coal - Indonesia
- The Treasury - Australian Government
- Intertek Mineral Services - Indonesia
- Sical Logistics Limited - India
- Tamil Nadu electricity Board
- Trasteel International SA, Italy
- Medco Energi Mining Internasional
- Vizag Seaport Private Limited - India
- Marubeni Corporation - India
- Karaikal Port Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Makarim & Taira - Indonesia
- South Luzon Thermal Energy Corporation
- Bayan Resources Tbk. - Indonesia
- Directorate Of Revenue Intelligence - India
- Attock Cement Pakistan Limited
- London Commodity Brokers - England
- Chettinad Cement Corporation Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Merrill Lynch Commodities Europe
- Orica Australia Pty. Ltd.
- Price Waterhouse Coopers - Russia
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- Borneo Indobara - Indonesia
- GMR Energy Limited - India
- Bangladesh Power Developement Board
- The University of Queensland
- Vijayanagar Sugar Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Chamber of Mines of South Africa
- Central Electricity Authority - India
- Deloitte Consulting - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PTC India Limited - India
- Siam City Cement PLC, Thailand
- Holcim Trading Pte Ltd - Singapore
- Kohat Cement Company Ltd. - Pakistan
- PowerSource Philippines DevCo
- Vedanta Resources Plc - India
- ICICI Bank Limited - India
- Maheswari Brothers Coal Limited - India
- Coastal Gujarat Power Limited - India
- MS Steel International - UAE
- Karbindo Abesyapradhi - Indoneisa
- Bhatia International Limited - India
- Banpu Public Company Limited - Thailand
- SMG Consultants - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- Standard Chartered Bank - UAE
- Meralco Power Generation, Philippines
- Globalindo Alam Lestari - Indonesia
- Lanco Infratech Ltd - India
- Parliament of New Zealand
- Semirara Mining and Power Corporation, Philippines
- Agrawal Coal Company - India
- Indogreen Group - Indonesia
- Thiess Contractors Indonesia
- Straits Asia Resources Limited - Singapore
- Formosa Plastics Group - Taiwan
- Anglo American - United Kingdom
- Maharashtra Electricity Regulatory Commission - India
- Kobexindo Tractors - Indoneisa
- Rio Tinto Coal - Australia
- Ambuja Cements Ltd - India
- Manunggal Multi Energi - Indonesia
- Renaissance Capital - South Africa
- Indika Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Eastern Coal Council - USA
- Toyota Tsusho Corporation, Japan
- Electricity Generating Authority of Thailand
- Aboitiz Power Corporation - Philippines
- Port Waratah Coal Services - Australia
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