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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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Tuesday, 25 August 15
INDONESIA MINERS' NPLS TO RISE FURTHER, BANK RISKS BUILD - FITCH
The NPLs of Indonesian mine and mine services companies are likely to rise further in the short term, says Fitch Ratings, after reaching multi-year ...
Tuesday, 25 August 15
MINER'S EARNINGS DROP ON FALLING COAL PRICES; Q2'16 FOB RICHARDS BAY COAL SWAP CLOSED AT $ 52.23 A TON
COALspot.com: API4 FOB Richards Bay Coal swap for delivery 4Q' 2015 declined month over month and week over week.
The 4Q swap was down US$ ...
Monday, 24 August 15
FOB NEWCASTLE COAL SWAPS HIT FRESH LOW, DIPPING BELOW $42 A TON
COALspot.com: API 5 FOB Newcastle Coal swap for 4Q’ 2015 delivery down $ 2.20 per MT (-5.01%) month over month to US$ 41.70 per mt. The swap ...
Monday, 24 August 15
Q1'16 CFR SOUTH CHINA COAL SWAP CLOSED AT $ 48.65 PMT
COALspot.com: API 8 CFR South China Coal swap for 4Q’ 2015 delivery declined just US$ 1.89 (3.74%) per MT month over month.
A commodity ...
Monday, 24 August 15
IS CHINA'S STEEL EXPORTS ENOUGH TO SUPPORT THE FREIGHT MARKET? - BIMCO
No, it’s not enough, you will need lower Chinese iron ore production too in order to keep growing imports of iron ore into China that will su ...
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- Essar Steel Hazira Ltd - India
- Planning Commission, India
- Meralco Power Generation, Philippines
- Bukit Baiduri Energy - Indonesia
- Lanco Infratech Ltd - India
- Georgia Ports Authority, United States
- CNBM International Corporation - China
- Electricity Authority, New Zealand
- Ministry of Transport, Egypt
- Karbindo Abesyapradhi - Indoneisa
- Antam Resourcindo - Indonesia
- Xindia Steels Limited - India
- Kideco Jaya Agung - Indonesia
- Renaissance Capital - South Africa
- Maheswari Brothers Coal Limited - India
- Latin American Coal - Colombia
- Petrochimia International Co. Ltd.- Taiwan
- Agrawal Coal Company - India
- South Luzon Thermal Energy Corporation
- Neyveli Lignite Corporation Ltd, - India
- Makarim & Taira - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- New Zealand Coal & Carbon
- Australian Coal Association
- Iligan Light & Power Inc, Philippines
- The University of Queensland
- Semirara Mining Corp, Philippines
- Directorate Of Revenue Intelligence - India
- Standard Chartered Bank - UAE
- Bhatia International Limited - India
- Baramulti Group, Indonesia
- Jaiprakash Power Ventures ltd
- Straits Asia Resources Limited - Singapore
- Siam City Cement - Thailand
- Miang Besar Coal Terminal - Indonesia
- Orica Mining Services - Indonesia
- Mintek Dendrill Indonesia
- Edison Trading Spa - Italy
- Indo Tambangraya Megah - Indonesia
- Deloitte Consulting - India
- India Bulls Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Wood Mackenzie - Singapore
- Sarangani Energy Corporation, Philippines
- Bangladesh Power Developement Board
- Carbofer General Trading SA - India
- Tamil Nadu electricity Board
- McConnell Dowell - Australia
- Malabar Cements Ltd - India
- Power Finance Corporation Ltd., India
- Karaikal Port Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- TeaM Sual Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Sree Jayajothi Cements Limited - India
- Port Waratah Coal Services - Australia
- Indonesian Coal Mining Association
- Ministry of Finance - Indonesia
- Bayan Resources Tbk. - Indonesia
- White Energy Company Limited
- Uttam Galva Steels Limited - India
- Africa Commodities Group - South Africa
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- IEA Clean Coal Centre - UK
- Ministry of Mines - Canada
- Price Waterhouse Coopers - Russia
- European Bulk Services B.V. - Netherlands
- Sojitz Corporation - Japan
- Global Business Power Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Coastal Gujarat Power Limited - India
- Heidelberg Cement - Germany
- Mercator Lines Limited - India
- Singapore Mercantile Exchange
- GVK Power & Infra Limited - India
- Sakthi Sugars Limited - India
- Electricity Generating Authority of Thailand
- Sindya Power Generating Company Private Ltd
- Cigading International Bulk Terminal - Indonesia
- Kobexindo Tractors - Indoneisa
- Medco Energi Mining Internasional
- Bhushan Steel Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Goldman Sachs - Singapore
- Borneo Indobara - Indonesia
- Eastern Coal Council - USA
- Riau Bara Harum - Indonesia
- Independent Power Producers Association of India
- Indian Oil Corporation Limited
- Bharathi Cement Corporation - India
- Barasentosa Lestari - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Indika Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Trasteel International SA, Italy
- PetroVietnam Power Coal Import and Supply Company
- Tata Chemicals Ltd - India
- CIMB Investment Bank - Malaysia
- Parry Sugars Refinery, India
- ASAPP Information Group - India
- Bahari Cakrawala Sebuku - Indonesia
- Central Java Power - Indonesia
- Salva Resources Pvt Ltd - India
- Coalindo Energy - Indonesia
- Indian Energy Exchange, India
- SMG Consultants - Indonesia
- Intertek Mineral Services - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kartika Selabumi Mining - Indonesia
- IHS Mccloskey Coal Group - USA
- Global Green Power PLC Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- GN Power Mariveles Coal Plant, Philippines
- Indogreen Group - Indonesia
- Ambuja Cements Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Anglo American - United Kingdom
- Banpu Public Company Limited - Thailand
- Romanian Commodities Exchange
- Vedanta Resources Plc - India
- Mercuria Energy - Indonesia
- Chamber of Mines of South Africa
- Formosa Plastics Group - Taiwan
- Bhoruka Overseas - Indonesia
- Energy Development Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- SN Aboitiz Power Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Dalmia Cement Bharat India
- Binh Thuan Hamico - Vietnam
- Gujarat Sidhee Cement - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sical Logistics Limited - India
- GAC Shipping (India) Pvt Ltd
- Metalloyd Limited - United Kingdom
- Energy Link Ltd, New Zealand
- Altura Mining Limited, Indonesia
- Rio Tinto Coal - Australia
- The Treasury - Australian Government
- Pipit Mutiara Jaya. PT, Indonesia
- Posco Energy - South Korea
- Eastern Energy - Thailand
- Aboitiz Power Corporation - Philippines
- Simpson Spence & Young - Indonesia
- PNOC Exploration Corporation - Philippines
- SMC Global Power, Philippines
- The State Trading Corporation of India Ltd
- VISA Power Limited - India
- Star Paper Mills Limited - India
- PTC India Limited - India
- Mjunction Services Limited - India
- Economic Council, Georgia
- Jorong Barutama Greston.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Oldendorff Carriers - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Globalindo Alam Lestari - Indonesia
- Chettinad Cement Corporation Ltd - India
- Manunggal Multi Energi - Indonesia
- Merrill Lynch Commodities Europe
- PowerSource Philippines DevCo
- Grasim Industreis Ltd - India
- Aditya Birla Group - India
- International Coal Ventures Pvt Ltd - India
- Thiess Contractors Indonesia
- Timah Investasi Mineral - Indoneisa
- Gujarat Mineral Development Corp Ltd - India
- Pendopo Energi Batubara - Indonesia
- Larsen & Toubro Limited - India
- San Jose City I Power Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- Central Electricity Authority - India
- Kepco SPC Power Corporation, Philippines
- Parliament of New Zealand
- Orica Australia Pty. Ltd.
- Offshore Bulk Terminal Pte Ltd, Singapore
- Wilmar Investment Holdings
- MS Steel International - UAE
- LBH Netherlands Bv - Netherlands
- Bulk Trading Sa - Switzerland
- Australian Commodity Traders Exchange
- Interocean Group of Companies - India
- AsiaOL BioFuels Corp., Philippines
- Videocon Industries ltd - India
- Therma Luzon, Inc, Philippines
- Petron Corporation, Philippines
- London Commodity Brokers - England
- Kaltim Prima Coal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- ICICI Bank Limited - India
- Kumho Petrochemical, South Korea
- Vizag Seaport Private Limited - India
- Alfred C Toepfer International GmbH - Germany
- Cement Manufacturers Association - India
- Ind-Barath Power Infra Limited - India
- Siam City Cement PLC, Thailand
- Krishnapatnam Port Company Ltd. - India
- Sinarmas Energy and Mining - Indonesia
- Minerals Council of Australia
- Marubeni Corporation - India
- Commonwealth Bank - Australia
- Savvy Resources Ltd - HongKong
- Madhucon Powers Ltd - India
- Gujarat Electricity Regulatory Commission - India
- GMR Energy Limited - India
- Thai Mozambique Logistica
- Samtan Co., Ltd - South Korea
- Coal and Oil Company - UAE
- Ceylon Electricity Board - Sri Lanka
- Dong Bac Coal Mineral Investment Coporation - Vietnam
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