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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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Friday, 28 August 15
COAL PRODUCTION IN THE U.S. FOR THE WEEK ENDING AUGUST 22 ROSE FOR THE THIRD STRAIGHT WEEK
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 18.5 million shor ...
Friday, 28 August 15
BANPU STRENGTHENS GROWTH PLAN
Coal Business: Asia-Pacific Synergies Increase Competitiveness for Premium Export Market.
Banpu Public Company Limited (BANPU) strengthens its ...
Thursday, 27 August 15
RATES FOR CAPES REMAINED ON A FREE FALL LAST WEEK - INTERMODAL
COALspot.com: Keeping everyone on their toes with the volatility seen in August, the Dry Bulk market undoubtedly remains a steady provider of chall ...
Wednesday, 26 August 15
MARKET INSIGHT - STRATOS TINIAKOS
It’s always interesting to comment on the market when big economies around the world are facing troubling times. Following the collapse of th ...
Wednesday, 26 August 15
2Q'16 FOB INDONESIA COAL SWAP FALLS NEARLY 4.76 PER CENT M-O-M
COALspot.com: Indonesian coal swap for delivery 4Q 2015 declined month on month and week over week.
The 4Q swap was declined $ 2.20 (-5.13%) p ...
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- Australian Commodity Traders Exchange
- Gujarat Electricity Regulatory Commission - India
- Binh Thuan Hamico - Vietnam
- McConnell Dowell - Australia
- PetroVietnam Power Coal Import and Supply Company
- Meralco Power Generation, Philippines
- Mercuria Energy - Indonesia
- Singapore Mercantile Exchange
- Timah Investasi Mineral - Indoneisa
- Indian Oil Corporation Limited
- Thai Mozambique Logistica
- Chettinad Cement Corporation Ltd - India
- OPG Power Generation Pvt Ltd - India
- Parliament of New Zealand
- TeaM Sual Corporation - Philippines
- Riau Bara Harum - Indonesia
- Trasteel International SA, Italy
- ICICI Bank Limited - India
- Standard Chartered Bank - UAE
- Price Waterhouse Coopers - Russia
- Sinarmas Energy and Mining - Indonesia
- Kepco SPC Power Corporation, Philippines
- Carbofer General Trading SA - India
- Directorate Of Revenue Intelligence - India
- Therma Luzon, Inc, Philippines
- Barasentosa Lestari - Indonesia
- Indo Tambangraya Megah - Indonesia
- Baramulti Group, Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Kideco Jaya Agung - Indonesia
- Mintek Dendrill Indonesia
- Pendopo Energi Batubara - Indonesia
- Wilmar Investment Holdings
- Malabar Cements Ltd - India
- Energy Development Corp, Philippines
- Australian Coal Association
- Bangladesh Power Developement Board
- The University of Queensland
- Kaltim Prima Coal - Indonesia
- Grasim Industreis Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Rashtriya Ispat Nigam Limited - India
- SN Aboitiz Power Inc, Philippines
- Eastern Energy - Thailand
- Port Waratah Coal Services - Australia
- Essar Steel Hazira Ltd - India
- Bulk Trading Sa - Switzerland
- Altura Mining Limited, Indonesia
- Vedanta Resources Plc - India
- GVK Power & Infra Limited - India
- VISA Power Limited - India
- Simpson Spence & Young - Indonesia
- PowerSource Philippines DevCo
- Parry Sugars Refinery, India
- Sarangani Energy Corporation, Philippines
- Indonesian Coal Mining Association
- Romanian Commodities Exchange
- Power Finance Corporation Ltd., India
- Bukit Makmur.PT - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Interocean Group of Companies - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- MS Steel International - UAE
- San Jose City I Power Corp, Philippines
- Tata Chemicals Ltd - India
- Electricity Authority, New Zealand
- Minerals Council of Australia
- Bukit Baiduri Energy - Indonesia
- Thiess Contractors Indonesia
- Semirara Mining and Power Corporation, Philippines
- Lanco Infratech Ltd - India
- Bhoruka Overseas - Indonesia
- Larsen & Toubro Limited - India
- Leighton Contractors Pty Ltd - Australia
- Manunggal Multi Energi - Indonesia
- Medco Energi Mining Internasional
- Aditya Birla Group - India
- SMC Global Power, Philippines
- Krishnapatnam Port Company Ltd. - India
- Asmin Koalindo Tuhup - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ministry of Finance - Indonesia
- Vizag Seaport Private Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Madhucon Powers Ltd - India
- Sree Jayajothi Cements Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Semirara Mining Corp, Philippines
- Indian Energy Exchange, India
- Agrawal Coal Company - India
- Attock Cement Pakistan Limited
- Planning Commission, India
- Makarim & Taira - Indonesia
- Globalindo Alam Lestari - Indonesia
- Sical Logistics Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Savvy Resources Ltd - HongKong
- Goldman Sachs - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Edison Trading Spa - Italy
- Posco Energy - South Korea
- Petrochimia International Co. Ltd.- Taiwan
- Oldendorff Carriers - Singapore
- Indika Energy - Indonesia
- Coal and Oil Company - UAE
- Eastern Coal Council - USA
- Africa Commodities Group - South Africa
- The State Trading Corporation of India Ltd
- Economic Council, Georgia
- Bhushan Steel Limited - India
- Borneo Indobara - Indonesia
- Kobexindo Tractors - Indoneisa
- Mjunction Services Limited - India
- Sojitz Corporation - Japan
- South Luzon Thermal Energy Corporation
- Holcim Trading Pte Ltd - Singapore
- Latin American Coal - Colombia
- Energy Link Ltd, New Zealand
- CNBM International Corporation - China
- Ministry of Mines - Canada
- Independent Power Producers Association of India
- Chamber of Mines of South Africa
- Salva Resources Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Global Green Power PLC Corporation, Philippines
- Videocon Industries ltd - India
- Petron Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Wood Mackenzie - Singapore
- IEA Clean Coal Centre - UK
- Global Coal Blending Company Limited - Australia
- Central Electricity Authority - India
- Samtan Co., Ltd - South Korea
- London Commodity Brokers - England
- Orica Mining Services - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Ambuja Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- ASAPP Information Group - India
- Straits Asia Resources Limited - Singapore
- Coalindo Energy - Indonesia
- Electricity Generating Authority of Thailand
- Kohat Cement Company Ltd. - Pakistan
- Meenaskhi Energy Private Limited - India
- India Bulls Power Limited - India
- Xindia Steels Limited - India
- Karaikal Port Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Marubeni Corporation - India
- Commonwealth Bank - Australia
- CIMB Investment Bank - Malaysia
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Antam Resourcindo - Indonesia
- Bharathi Cement Corporation - India
- Kumho Petrochemical, South Korea
- Miang Besar Coal Terminal - Indonesia
- Heidelberg Cement - Germany
- AsiaOL BioFuels Corp., Philippines
- Dalmia Cement Bharat India
- Indogreen Group - Indonesia
- Anglo American - United Kingdom
- Deloitte Consulting - India
- Formosa Plastics Group - Taiwan
- Cement Manufacturers Association - India
- Coastal Gujarat Power Limited - India
- PTC India Limited - India
- Merrill Lynch Commodities Europe
- Star Paper Mills Limited - India
- Sakthi Sugars Limited - India
- Gujarat Sidhee Cement - India
- Bayan Resources Tbk. - Indonesia
- Siam City Cement PLC, Thailand
- Maharashtra Electricity Regulatory Commission - India
- Renaissance Capital - South Africa
- Bahari Cakrawala Sebuku - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Aboitiz Power Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Mercator Lines Limited - India
- Global Business Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- Kapuas Tunggal Persada - Indonesia
- Uttam Galva Steels Limited - India
- Neyveli Lignite Corporation Ltd, - India
- New Zealand Coal & Carbon
- SMG Consultants - Indonesia
- Georgia Ports Authority, United States
- Jorong Barutama Greston.PT - Indonesia
- GAC Shipping (India) Pvt Ltd
- Metalloyd Limited - United Kingdom
- Ministry of Transport, Egypt
- Toyota Tsusho Corporation, Japan
- Ind-Barath Power Infra Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Banpu Public Company Limited - Thailand
- Central Java Power - Indonesia
- International Coal Ventures Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- IHS Mccloskey Coal Group - USA
- Pipit Mutiara Jaya. PT, Indonesia
- Rio Tinto Coal - Australia
- Jaiprakash Power Ventures ltd
- The Treasury - Australian Government
- White Energy Company Limited
- PNOC Exploration Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement - Thailand
- Sindya Power Generating Company Private Ltd
- Kalimantan Lumbung Energi - Indonesia
- Kartika Selabumi Mining - Indonesia
- Tamil Nadu electricity Board
- Maheswari Brothers Coal Limited - India
- GMR Energy Limited - India
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