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Thursday, 10 September 15
IF NOT NOW, WHEN? - GIANNIS ANDRITSOPOULOS
 Our industry is well known to be cyclical with some cycles lasting longer than others. Despite the fact that these shifts in the behavior of the freight market are hardly a surprise anymore, the bottom of each cycle will always find some market participants better prepared than others, having made provisions for the difficult days that follow a period of healthy rates.
The fall in rates naturally succeeds a good period in the market that is characterized by increased freight rates and high asset values. When this fall is combined with low demolition activity and overwhelming deliveries, oversupply of tonnage is the natural consequence. Many owners believe that the bottom of each cycle offers the market a chance to find its balance, while at the same time it also presents buying opportunities that owners can capitalize on once the rebound in rates finally comes.
If we focus on what has been happening during the last three quarters of the year and how the freight market has moved from very low to healthier levels, it is evident that despite the fact that demand cannot be predicted and safely placed into the trade equation, increased demolition and decelerating order books are definitely pushing towards the right direction.
Looking at the year to date period, an interesting point is that buying interest expressed by some owners that usually focus their activity on wet tonnage, has now oriented towards second hand Dry Bulk vessels. The attractive secondhand values over at the Dry Bulk market seem to have convinced non-traditional Dry Bulk owners to invest in the sector, with modern units that are currently priced well below the respective new building assets, luring most of the market interest.
In the first quarter of the year we only saw a small number of second-hand transactions concluding when compared to the number of inspections performed, while as we headed towards the second quarter, the number of buyers in the second hand dry bulk market increased impressively despite the fact that the BDI had hardly moved.
Having as a starting point the sale of the “PRABHU MOHINI” (82,000dwt, ‘11 blt 2011, S. Korea) at low $17.0m back in the beginning of April up to the sale of the “PINCHAT (81,290dwt, ‘12 blt, S. Korea) at $21.5m a couple of weeks ago, we see a gradual improvement in asset values that has not been affected by the ups and downs of the BDI during the second half of the summer season.
Is therefore now the time for an owner who is determined and can support the acquisition of a vessel for a few years to invest in the second-hand market? With the last done for a Japanese Supramax blt ‘08 at $10.8m and the last done for a Japanese Handysize blt ‘11 at $10.0m, the argument for acquisitions is definitely strong.
Predicting the bottom or the top of the cycle is fairly impossible. Back in 2005 owners who acquired second-hand tonnage had to watch rates fall for more than a year most probably thinking; ”Game Over”. Yet a bit later on and for the next two years, their uncertainty was replaced by the feeling of absolute success and the rest is history. We are not suggesting that asset values could over-perform in the same way they did back then..but saying this, is anyone convinced that there is no significant upside to current levels?
By Giannis Andritsopoulos
SnP Broker
Compiled by:
Intermodal Research & Valuations
Analysts:
Ms. Eva Tzima
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no re-producing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
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Wednesday, 25 November 15
INDIA'S POWER GENERATORS FACE LOW, FALLING UTILISATION RATE - FITCH
COAlspot.com: Fitch Ratings says in a new report that the utilisation rate of India's thermal power generation capacity continued to decline in ...
Wednesday, 25 November 15
BIG CHINESE COPPER PROCESSORS DEFEND MARGINS THROUGH R&D, SAYS FITCH
Large Chinese copper processors are focusing on higher value-added products and investing in R&D to enhance their technical know-how to maintai ...
Wednesday, 25 November 15
BIMCO LAUNCHES ANTI-CORRUPTION CLAUSE FOR SHIPPING CONTRACTS WORLDWIDE
COALspot.com: BIMCO, is the world’s largest international shipping association, with 2,200 members in around 130 countries, has now launched ...
Wednesday, 25 November 15
TANKER MARKET INSIGHT - GEORGE VASTARDIS
We have already noticed obvious signs of activity mainly West of Suez, which are currently driving the clean MR market to higher levels. Over the p ...
Tuesday, 24 November 15
COAL SUPPLY PRESSURE PUTS INDONESIAN HBA IN FREE FALL
The coal industry is slowly recognizing that, the current coal price level is not a decrease in price, but a change in pricing to corresp ...
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- Timah Investasi Mineral - Indoneisa
- Pipit Mutiara Jaya. PT, Indonesia
- IEA Clean Coal Centre - UK
- Vedanta Resources Plc - India
- Vizag Seaport Private Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Tamil Nadu electricity Board
- Heidelberg Cement - Germany
- Binh Thuan Hamico - Vietnam
- Videocon Industries ltd - India
- Asmin Koalindo Tuhup - Indonesia
- GVK Power & Infra Limited - India
- Madhucon Powers Ltd - India
- Singapore Mercantile Exchange
- Altura Mining Limited, Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Indo Tambangraya Megah - Indonesia
- AsiaOL BioFuels Corp., Philippines
- SMC Global Power, Philippines
- Kaltim Prima Coal - Indonesia
- Mintek Dendrill Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Kohat Cement Company Ltd. - Pakistan
- Interocean Group of Companies - India
- Globalindo Alam Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Attock Cement Pakistan Limited
- London Commodity Brokers - England
- GN Power Mariveles Coal Plant, Philippines
- White Energy Company Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Energy Link Ltd, New Zealand
- Krishnapatnam Port Company Ltd. - India
- Siam City Cement - Thailand
- Kepco SPC Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- PTC India Limited - India
- Malabar Cements Ltd - India
- Chettinad Cement Corporation Ltd - India
- Coastal Gujarat Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TeaM Sual Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Petron Corporation, Philippines
- VISA Power Limited - India
- Coalindo Energy - Indonesia
- SMG Consultants - Indonesia
- Deloitte Consulting - India
- Alfred C Toepfer International GmbH - Germany
- Australian Coal Association
- Simpson Spence & Young - Indonesia
- Manunggal Multi Energi - Indonesia
- Iligan Light & Power Inc, Philippines
- Aditya Birla Group - India
- Power Finance Corporation Ltd., India
- Romanian Commodities Exchange
- Oldendorff Carriers - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Mjunction Services Limited - India
- MS Steel International - UAE
- Kobexindo Tractors - Indoneisa
- Rio Tinto Coal - Australia
- Jindal Steel & Power Ltd - India
- Bangladesh Power Developement Board
- Kapuas Tunggal Persada - Indonesia
- Karaikal Port Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Xindia Steels Limited - India
- Thai Mozambique Logistica
- Sical Logistics Limited - India
- The University of Queensland
- Bhatia International Limited - India
- India Bulls Power Limited - India
- Goldman Sachs - Singapore
- Cement Manufacturers Association - India
- Gujarat Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Bhoruka Overseas - Indonesia
- Kumho Petrochemical, South Korea
- ASAPP Information Group - India
- Ind-Barath Power Infra Limited - India
- Tata Chemicals Ltd - India
- Sree Jayajothi Cements Limited - India
- Energy Development Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Electricity Authority, New Zealand
- Jorong Barutama Greston.PT - Indonesia
- Indian Oil Corporation Limited
- McConnell Dowell - Australia
- Gujarat Sidhee Cement - India
- GMR Energy Limited - India
- Formosa Plastics Group - Taiwan
- Eastern Energy - Thailand
- Siam City Cement PLC, Thailand
- Intertek Mineral Services - Indonesia
- ICICI Bank Limited - India
- Larsen & Toubro Limited - India
- Sarangani Energy Corporation, Philippines
- Semirara Mining Corp, Philippines
- Savvy Resources Ltd - HongKong
- Sakthi Sugars Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Agrawal Coal Company - India
- Billiton Holdings Pty Ltd - Australia
- Electricity Generating Authority of Thailand
- Independent Power Producers Association of India
- Therma Luzon, Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- Antam Resourcindo - Indonesia
- Sojitz Corporation - Japan
- Bahari Cakrawala Sebuku - Indonesia
- Commonwealth Bank - Australia
- CNBM International Corporation - China
- Rashtriya Ispat Nigam Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Minerals Council of Australia
- South Luzon Thermal Energy Corporation
- Salva Resources Pvt Ltd - India
- Mercuria Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Indonesian Coal Mining Association
- Essar Steel Hazira Ltd - India
- Jaiprakash Power Ventures ltd
- Sindya Power Generating Company Private Ltd
- Global Coal Blending Company Limited - Australia
- Renaissance Capital - South Africa
- Mercator Lines Limited - India
- Australian Commodity Traders Exchange
- Semirara Mining and Power Corporation, Philippines
- Ministry of Transport, Egypt
- Vijayanagar Sugar Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Riau Bara Harum - Indonesia
- Latin American Coal - Colombia
- Dalmia Cement Bharat India
- Indian Energy Exchange, India
- PowerSource Philippines DevCo
- Georgia Ports Authority, United States
- Parliament of New Zealand
- New Zealand Coal & Carbon
- International Coal Ventures Pvt Ltd - India
- Borneo Indobara - Indonesia
- Carbofer General Trading SA - India
- Makarim & Taira - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Bayan Resources Tbk. - Indonesia
- Standard Chartered Bank - UAE
- Banpu Public Company Limited - Thailand
- Sinarmas Energy and Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- Uttam Galva Steels Limited - India
- Grasim Industreis Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Planning Commission, India
- Meralco Power Generation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Maheswari Brothers Coal Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Kideco Jaya Agung - Indonesia
- SN Aboitiz Power Inc, Philippines
- Metalloyd Limited - United Kingdom
- Meenaskhi Energy Private Limited - India
- Ambuja Cements Ltd - India
- Samtan Co., Ltd - South Korea
- Central Java Power - Indonesia
- Global Green Power PLC Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Aboitiz Power Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Ministry of Finance - Indonesia
- Pendopo Energi Batubara - Indonesia
- Orica Mining Services - Indonesia
- The Treasury - Australian Government
- Lanco Infratech Ltd - India
- Medco Energi Mining Internasional
- LBH Netherlands Bv - Netherlands
- Bharathi Cement Corporation - India
- Wood Mackenzie - Singapore
- Indogreen Group - Indonesia
- Bhushan Steel Limited - India
- PNOC Exploration Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Posco Energy - South Korea
- Coal and Oil Company - UAE
- Bulk Trading Sa - Switzerland
- Economic Council, Georgia
- CIMB Investment Bank - Malaysia
- Global Business Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Central Electricity Authority - India
- Baramulti Group, Indonesia
- Merrill Lynch Commodities Europe
- Petrochimia International Co. Ltd.- Taiwan
- Orica Australia Pty. Ltd.
- GAC Shipping (India) Pvt Ltd
- Indika Energy - Indonesia
- The State Trading Corporation of India Ltd
- Parry Sugars Refinery, India
- European Bulk Services B.V. - Netherlands
- Directorate Of Revenue Intelligence - India
- Barasentosa Lestari - Indonesia
- Star Paper Mills Limited - India
- Thiess Contractors Indonesia
- Trasteel International SA, Italy
- Ministry of Mines - Canada
- Marubeni Corporation - India
- Wilmar Investment Holdings
- Chamber of Mines of South Africa
- Anglo American - United Kingdom
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