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Friday, 28 August 15
DRY BULK SHIP OWNER OPTIMISTIC ABOUT FUTURE PROSPECTS OF THE MARKET: NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Dry bulk ship owner Golden Ocean appeared optimistic on the long term prospects of the dry bulk market, mainly thanks to an expected resolution of the oversupply problems of the market. The owner added in its second quarter report that the average spot rates so far in the third quarter are higher than the rates in the first half of 2015, which means that the company’s revenues are expected to improve compared to the two previous quarters. Golden Ocean noted that following two very weak quarters, the third quarter started with more optimism, in particular, for the Capesize segment. With a spot market close to $20,000 per day it was questionable whether it was a structurally damaged market balance due to oversupply. “Then a three step devaluation by the Chinese Central Bank and a very nervous Chinese stock market removed all signs of optimism over a fortnight. With falling commodity prices and growing uncertainty in general, activity among dry bulk charterers is low at present. Short term this could be painful for owners of dry bulk assets, but in a longer term perspective the supply side should repair itself faster than previously anticipated”, Golden Ocean said.
In any case, according to the shipowner, the dry bulk spot market in the second quarter of 2015 did not give owners of dry bulk vessels any relief. “Rates ended up more or less at similar levels as in the pervious quarter and with limited volatility. According to the Baltic Exchange, average earnings for the Supramax segment were $6,766 per day compared to $6,434 per day in the previous quarter and $8,982 per day in the same quarter last year. Capesize vessels were again facing the lowest earnings with an average of $4,600 per day against $4,582 per day the previous quarter and $11,901 per day in the same quarter last year. Panamaxes earned on average $5,183 per day compared to $4,815 during the first quarter and $6,304 in the same quarter in 2014″.
FLEET SUPPLY
According to Golden Ocean though, the low utilization of the dry bulk fleet the first six months of the year has been due to demand issues rather than increased supply. “Actual deliveries for the first six months amounted to 110 Handysize vessels, 159 Handymaxes/Supramaxes, 88 Panamaxes/Kamsarmaxes and 57 Capesize vessels. During the first half of 2015 less than 27 mdwt were delivered. Even though the delivery rate picked up slightly during the month of July it is unlikely that the delivery ratio will exceed 65 per cent of the official order book this year. At the same time scrapping prior the monsoon season in June/July was beating most analysts’ expectations. For the entire sector above 10,000dwt, 300 vessels have been scrapped. The net effect of this is that after seven months into the year there is still zero net fleet growth for Handysize and Capesize”, said Golden Ocean.
The ship owner added that “historically, limited number of vessels will be delivered during the fourth quarter and in spite of fewer removals due to a combination of improved spot market and lower scrap prices, net fleet growth in 2015 will most likely end up at less than 3 per cent of additional capacity. In aggregate the total order book to fleet ratio fell below 18 per cent at the end of the second quarter, which marks the lowest level since 2003. Still many analysts believe that the official order book is bigger than reality. The positive trend on the supply side is definitely needed due to softer demand for dry bulk commodities”.
DRY BULK DEMAND
In terms of demand, Golden Ocean said in its report that “we witnessed a slight improvement in total demand in the second quarter of the year compared to the previous slow quarter. Measured in tonne miles demand for dry bulk commodities grew by one per cent compared to first quarter, but still one per cent lower than same quarter last year. Uncertainty and conflicting information from the most important country for dry bulk transportation is still making the headlines. The devaluation of the renminbi by the Chinese Central Bank took many by surprise. It is not expected that this will have a significant impact on import levels. Compared to the average exchange rate in January this year, the currency is trading 4 per cent lower while the average spot price for iron ore is 15 per cent lower than the January average price. Chinese steel consumption (observed) was 4.3 per cent lower in the second quarter compared to the same quarter last year, but increased by 3.5 per cent compared to the previous quarter. Chinese iron ore imports for the first half the year ended at 453 million mt, followed by a strong 86 million mt in July. This is 15 per cent up from previous month and the highest monthly import figure seen in 2015. It is interesting to note that iron ore inventories remain at relatively low levels and almost 30 million mt lower than same time last year. Australia and Brazil continue taking market share from marginal producers and are up 30 million and 10 million tons, respectively, in the first seven months of 2015. New capacity from both countries is expected to be made available in the coming months represented by Roy Hill in Australia and new production from Vale. Coal imports to China continue to be the most negative contributor to dry bulk demand and are 34 per cent lower year-on-year for the first seven months of 2015. July showed a similar uptick in imports as for iron ore and for the last few weeks Chinas southwestern regions received less rain than usual. As a consequence hydro power production in July fell for the first time since October 2013. Given that China imports only six per cent of the coal it consumes, the sensitivity and uncertainty is substantial. Limited new hydro power capacity will be introduced over the next five years. India’s growth in coal imports is steady, but at a slower pace last two months. In the first half of 2015, the country imported 120 million mt which is almost 30 million mt more than the same period previous year”, Golden Ocean noted.
Ship prices
The soft freight market continued to put downward pressure on asset values for all vessel classes during the second quarter. According to industry sources, prices fell by 7.5 percent to 12.5 percent depending on the country of construction. Asset prices have reacted positively so far in third quarter to the improved spot market freight environment and most analysts are of the opinion that the industry has seen the bottom in this cycle”, the shipowner concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Monday, 07 September 15
CFR SOUTH CHINA COAL SWAPS ROSE 1.1 PER CENT WEEK OVER WEEK
COALspot.com: API 8 CFR South China Coal swap for 4Q’ 2015 delivery declined just US$ 1.52 (3 %) per MT month over month.
A commodity sw ...
Sunday, 06 September 15
AUTOMATION AND TECHNOLOGY IS CERTAINLY PART OF THE SOLUTION FOR IMPROVING PERFORMANCE AND EFFICIENCY TO MAKE THE MINE OPERATIONS MORE PROFITABLE, HOWEVER............ - LUKE JALSEVAC
"The Technology and Innovation in Mining 2015" production team at Information Exchange Group interviewed Luke Jalsevac, Director, Busines ...
Sunday, 06 September 15
THE CAPE SIZE INDEX ROSE 10.83 PER CENT WEEK OVER WEEK
COALspot.com: The BDI, the Baltic exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, declined o ...
Saturday, 05 September 15
DRY BULK MARKET MAY SUFFER NOW, BUT IS BOUND FOR A RECOVERY THANKS TO A LIMITED FUTURE FLEET GROWTH - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The slow increase of dry bulk tonnage growth this year could turn into a solid indicator of the market’s future prospects. According to a rec ...
Friday, 04 September 15
U.S. COAL PRODUCTION FOR THE W/E AUGUST 29, UP SLIGHTLY; FALL 4.5 PERCENT Y-Y: EIA
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 18.7 million shor ...
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- Aditya Birla Group - India
- Semirara Mining and Power Corporation, Philippines
- MS Steel International - UAE
- Sakthi Sugars Limited - India
- LBH Netherlands Bv - Netherlands
- Binh Thuan Hamico - Vietnam
- Central Java Power - Indonesia
- Central Electricity Authority - India
- Coal and Oil Company - UAE
- Sinarmas Energy and Mining - Indonesia
- Bukit Baiduri Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Siam City Cement - Thailand
- Billiton Holdings Pty Ltd - Australia
- Gujarat Mineral Development Corp Ltd - India
- Timah Investasi Mineral - Indoneisa
- Electricity Generating Authority of Thailand
- Thai Mozambique Logistica
- Energy Link Ltd, New Zealand
- Parliament of New Zealand
- Ind-Barath Power Infra Limited - India
- Wilmar Investment Holdings
- Kobexindo Tractors - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Eastern Energy - Thailand
- Planning Commission, India
- Malabar Cements Ltd - India
- Indo Tambangraya Megah - Indonesia
- South Luzon Thermal Energy Corporation
- GAC Shipping (India) Pvt Ltd
- Bayan Resources Tbk. - Indonesia
- New Zealand Coal & Carbon
- Tata Chemicals Ltd - India
- Energy Development Corp, Philippines
- The State Trading Corporation of India Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Grasim Industreis Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Minerals Council of Australia
- Videocon Industries ltd - India
- IHS Mccloskey Coal Group - USA
- Petrochimia International Co. Ltd.- Taiwan
- GN Power Mariveles Coal Plant, Philippines
- Cigading International Bulk Terminal - Indonesia
- Bangladesh Power Developement Board
- Electricity Authority, New Zealand
- SMC Global Power, Philippines
- SN Aboitiz Power Inc, Philippines
- Deloitte Consulting - India
- Mercator Lines Limited - India
- Price Waterhouse Coopers - Russia
- VISA Power Limited - India
- Standard Chartered Bank - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- IEA Clean Coal Centre - UK
- Simpson Spence & Young - Indonesia
- Romanian Commodities Exchange
- OPG Power Generation Pvt Ltd - India
- Mercuria Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Chamber of Mines of South Africa
- Bharathi Cement Corporation - India
- Parry Sugars Refinery, India
- Globalindo Alam Lestari - Indonesia
- Tamil Nadu electricity Board
- Indian Oil Corporation Limited
- PowerSource Philippines DevCo
- Indogreen Group - Indonesia
- CIMB Investment Bank - Malaysia
- Therma Luzon, Inc, Philippines
- Madhucon Powers Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Straits Asia Resources Limited - Singapore
- Trasteel International SA, Italy
- Anglo American - United Kingdom
- Ministry of Transport, Egypt
- Bulk Trading Sa - Switzerland
- Meenaskhi Energy Private Limited - India
- The University of Queensland
- Orica Mining Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Formosa Plastics Group - Taiwan
- Directorate General of MIneral and Coal - Indonesia
- Xindia Steels Limited - India
- Uttam Galva Steels Limited - India
- TeaM Sual Corporation - Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- London Commodity Brokers - England
- CNBM International Corporation - China
- Metalloyd Limited - United Kingdom
- International Coal Ventures Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Georgia Ports Authority, United States
- Karbindo Abesyapradhi - Indoneisa
- Riau Bara Harum - Indonesia
- Banpu Public Company Limited - Thailand
- Bahari Cakrawala Sebuku - Indonesia
- GMR Energy Limited - India
- Bhoruka Overseas - Indonesia
- Thiess Contractors Indonesia
- PTC India Limited - India
- Bhushan Steel Limited - India
- Ministry of Finance - Indonesia
- Salva Resources Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Chettinad Cement Corporation Ltd - India
- Kumho Petrochemical, South Korea
- Agrawal Coal Company - India
- Port Waratah Coal Services - Australia
- Samtan Co., Ltd - South Korea
- Marubeni Corporation - India
- Neyveli Lignite Corporation Ltd, - India
- Cement Manufacturers Association - India
- Indian Energy Exchange, India
- Kohat Cement Company Ltd. - Pakistan
- Maheswari Brothers Coal Limited - India
- Interocean Group of Companies - India
- Siam City Cement PLC, Thailand
- Independent Power Producers Association of India
- Wood Mackenzie - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Edison Trading Spa - Italy
- Goldman Sachs - Singapore
- San Jose City I Power Corp, Philippines
- Kepco SPC Power Corporation, Philippines
- Australian Coal Association
- Attock Cement Pakistan Limited
- Oldendorff Carriers - Singapore
- Antam Resourcindo - Indonesia
- Star Paper Mills Limited - India
- Sindya Power Generating Company Private Ltd
- Coastal Gujarat Power Limited - India
- Alfred C Toepfer International GmbH - Germany
- Kapuas Tunggal Persada - Indonesia
- Lanco Infratech Ltd - India
- Ambuja Cements Ltd - India
- Savvy Resources Ltd - HongKong
- Australian Commodity Traders Exchange
- Karaikal Port Pvt Ltd - India
- Bhatia International Limited - India
- Jaiprakash Power Ventures ltd
- Bukit Makmur.PT - Indonesia
- Mintek Dendrill Indonesia
- Sree Jayajothi Cements Limited - India
- Gujarat Electricity Regulatory Commission - India
- Sarangani Energy Corporation, Philippines
- Borneo Indobara - Indonesia
- Global Coal Blending Company Limited - Australia
- Pendopo Energi Batubara - Indonesia
- Africa Commodities Group - South Africa
- Commonwealth Bank - Australia
- Indika Energy - Indonesia
- Dalmia Cement Bharat India
- Toyota Tsusho Corporation, Japan
- Carbofer General Trading SA - India
- Coalindo Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Vizag Seaport Private Limited - India
- SMG Consultants - Indonesia
- Merrill Lynch Commodities Europe
- ICICI Bank Limited - India
- Gujarat Sidhee Cement - India
- Semirara Mining Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kideco Jaya Agung - Indonesia
- The Treasury - Australian Government
- Essar Steel Hazira Ltd - India
- Posco Energy - South Korea
- Krishnapatnam Port Company Ltd. - India
- Asmin Koalindo Tuhup - Indonesia
- Economic Council, Georgia
- Renaissance Capital - South Africa
- Iligan Light & Power Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Intertek Mineral Services - Indonesia
- Heidelberg Cement - Germany
- Jindal Steel & Power Ltd - India
- European Bulk Services B.V. - Netherlands
- Singapore Mercantile Exchange
- Kaltim Prima Coal - Indonesia
- PNOC Exploration Corporation - Philippines
- GVK Power & Infra Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Meralco Power Generation, Philippines
- Ministry of Mines - Canada
- White Energy Company Limited
- Sical Logistics Limited - India
- Ceylon Electricity Board - Sri Lanka
- Global Green Power PLC Corporation, Philippines
- India Bulls Power Limited - India
- McConnell Dowell - Australia
- Sojitz Corporation - Japan
- Vedanta Resources Plc - India
- Indonesian Coal Mining Association
- Miang Besar Coal Terminal - Indonesia
- Altura Mining Limited, Indonesia
- Petron Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Rio Tinto Coal - Australia
- Directorate Of Revenue Intelligence - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Business Power Corporation, Philippines
- Medco Energi Mining Internasional
- Latin American Coal - Colombia
- Mjunction Services Limited - India
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- ASAPP Information Group - India
- Eastern Coal Council - USA
- Baramulti Group, Indonesia
- Larsen & Toubro Limited - India
- Manunggal Multi Energi - Indonesia
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