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Monday, 12 October 15
DRY BULK SHIPPING: MARKETS ARE SLOWLY IMPROVING FROM A VERY LOW LEVEL AS THE DEMAND SIDE FALTERS - HELLENIC SHIPPING NEWS
 The dry bulk market is in the midst of a shift in demand patterns, which coupled with a tonnage supply overhang, has been facing headwinds over the past few years. In its latest short-term outlook, BIMCO noted that “when traditional demand growth is not increasing, we need to look harder for future growth. Here the glut of high-iron-content ore in the international markets and the following low prices may finally bring around a sizeable substitution in consumption by Chinese steel mills, away from the domestically produced low-iron-content ore, in favour of imports”.
“Calculations done by BIMCO show that monthly imports into China could be 20mt higher per month (+26%). A total of an extra 240 million tons on an annual basis could bring deployment for around 155 Capesizes, assuming an unchanged distribution between Australian and Brazilian imports (75%/25%). Last year, Australia grew its share significantly as 90% of Chinese incremental demand came from Australia.
As Brazilian miner Vale is expecting to grow its output over the next year, this would improve the prospects. Working against would be more Brazilian ore transported on 400,000-DWT Valemax class ships operated by the miner itself or related parties”, BIMCO noted in its report.
As such, it concludes that “for the coming months: September-November, BIMCO expects the supply of new ships to stay subdued and slow paced towards the end of the year. The deteriorating demand-side conditions are expected to be somewhat reversed as we move into the stronger months of the year. The vital commodities, coal and iron ore, are both expected to be in higher demand in coming months, enhancing owners’ and operators’ opportunities to find employment for their ships. Altogether this should support the freight rates although no large-scale improvement to the fundamental balance is likely to develop”.
According to BIMCO’s Chief Shipping Analyst, Peter Sand, “the shipping market and underlying profitability can only improve if the fundamental conditions (supply and demand) also improve. Therefore transportation of larger volumes, longer sailing distances in general or a lower increase of dry-bulk fleet size is a prerequisite for better markets to arrive. On the first issue about more commodities, we have seen coal as the primary culprit so far, with grains potentially also sinking into the red before the end of the year. Volumes of steam coal and coking coal are both contracting notably, and our forecast is for an annual decline in transport driven by the lack of demand from China (-51 million mt) in the East and the UK (-13mt) in the West cushioned by increased appetite for imported steam coal in India (+16mt). Prospects for the latter have declined somewhat over the summer as domestic production and power-plant stocks both have risen”.
At the same time, “the coal-exporting nations suffering from this decline in demand are the two giants, Indonesia and Australia, while US exports are down on lower UK imports. On the positive side, the longer-than-normal grain season in South America has benefited primarily the Supramaxes, which apparently defy gravity as being the segment with the highest freight rates, while also facing the biggest increase in fleet size in the dry-bulk sector. Additionally, strong steel exports out of China have contributed to higher Supramax fleet use”.
BIMCO’s report also noted that “the second issue about ton–miles has also come into play this year as a part of the decline in coal has cut off the longer trades at the expense of the shorter hauls. The complete absence of South African thermal coal exports to China for more than a year now is a devastating example of this, especially when it is substituted by non-seaborne imports. In 2014 South Africa supplied China with 5.2mt of thermal down from 12.4mt in 2013.
Meanwhile, “the freight rates for all dry-bulk segments have been low throughout 2015, the July/August spike for Capesize ships being the short-lived exception. Averages for the first eight months of 2015 range from USD 5,605 per day for a Handysize to USD 8,163 per day for a Capesize. The poorest freight market on record is due to a combination of demand weakness and capacity abundance. Unfortunately, there are no easy ways to escape this. As China is going through a period of transition that does not favour the dry-bulk shipping industry, the prime driver is out of the picture. Capacity has been abundant for years, so it’s the change to the demand side, the variable that the industry cannot impact, which is at the epicentre in 2015”.
Supply-wise, BIMCO said that “speaking of the contributing factors to an improved shipping market, the dry-bulk fleet has grown only marginally during the first nine months. The inflow of 39.7 million DWT, which has been offset by demolition of 23.8 million DWT, means a fleet growth of just 2.1%. Continuance of a low fleet growth is vital to achieving an eventual recovery and a return of sustainable earnings for the industry. A central element in that equation is a low level of new orders. This has been accomplished by a landslide margin. In Clarksons orderbook statistics, there were only 84 new contracts recorded at the end of August. Such a cautious attitude is quite the opposite of what happened less than two years ago, when capacity equal to the year-to-date amount in 2015 (4.7 million DWT) was contracted in just 16 days!”
According to Mr. Sand, “demolition also holds a key position in today’s and tomorrow’s fleet-growth level. Although 306 ships have left the fleet so far in 2015, owners’ interest in making use of the demolition “tool” to limit supply growth seems to have evaporated completely over the summer. In early July, BIMCO cautioned that a new full year record level of demolished capacity would not arrive in spite of a record first half of the year. Unfortunately, our expectations have proven to be all too right. Spiking Capesize rates immediately cooled owners’ interest in the hope that a market rebound was around the corner”.
Furthermore, the strong Chinese steel export at discount prices to the countries that used to prefer scrap steel to new steel means that scrap prices keep heading lower and lower as volumes decrease. “Only 37 ships were sent to the blow torch in July and August. As trading conditions continue to challenge all shipowners and operators, everything that can be done to delay the delivery of the next ship has been done within the legally binding nature of a newbuilding contract. It is not easy to discuss terms with shipyards at a late stage in the building process, but the result is now clear. 2015 is about to receive “only” 49 million DWT, which will bring fleet growth down to a 10-year low at 2.5%”, BIMCO concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Thursday, 17 September 15
MARKET INSIGHT - KONSTANTINOS KONTOMICHIS
Having experienced, as it was much anticipated, a poor 1st half combined with negative forecasts, summer, in sharp contrast, proved to be more hope ...
Wednesday, 16 September 15
SLOWER GROWTH IN WORLD COAL DEMAND AND LOWER INTERNATIONAL COAL PRICES LED A DECLINE IN INDONESIAN COAL PRODUCTION
COALspot.com: Slower growth in world coal demand particularly China and lower international coal prices have led to a decline in Indonesian coal pr ...
Wednesday, 16 September 15
HIGHER TAXES COULD LEAD GREEK SHIP OWNERS OUT OF THE COUNTRY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
A potential taxation overhaul of the shipping industry in Hellas, which could see the loss of particular tax benefits for ship owners, could lead t ...
Tuesday, 15 September 15
WORLD SEABORNE TRADE: ENTERING INTO A ROLE REVERSAL? - CLARKSONS
Over the past decade, world seaborne trade growth has been dominated by dry bulk and container trade. However, developments in the global economy t ...
Tuesday, 15 September 15
Q2'16 RICHARDS BAY COAL SWAPS DIP TO $ 51.10 PER TON
COALspot.com: API4 FOB Richards Bay Coal swap for delivery 4Q' 2015 declined week over week and month over month.
The 4Q swap was down US$ ...
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Showing 2811 to 2815 news of total 6871 |
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- Holcim Trading Pte Ltd - Singapore
- Tamil Nadu electricity Board
- GMR Energy Limited - India
- Orica Mining Services - Indonesia
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Jindal Steel & Power Ltd - India
- Global Coal Blending Company Limited - Australia
- AsiaOL BioFuels Corp., Philippines
- McConnell Dowell - Australia
- Larsen & Toubro Limited - India
- Star Paper Mills Limited - India
- Bharathi Cement Corporation - India
- TNB Fuel Sdn Bhd - Malaysia
- Electricity Generating Authority of Thailand
- Anglo American - United Kingdom
- Videocon Industries ltd - India
- Electricity Authority, New Zealand
- Aboitiz Power Corporation - Philippines
- Uttam Galva Steels Limited - India
- Bukit Baiduri Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Agrawal Coal Company - India
- Indian Energy Exchange, India
- Ind-Barath Power Infra Limited - India
- The State Trading Corporation of India Ltd
- Kideco Jaya Agung - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Australian Coal Association
- Kaltim Prima Coal - Indonesia
- The University of Queensland
- Bhushan Steel Limited - India
- Ambuja Cements Ltd - India
- Grasim Industreis Ltd - India
- SMG Consultants - Indonesia
- PNOC Exploration Corporation - Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Romanian Commodities Exchange
- Siam City Cement PLC, Thailand
- Eastern Energy - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- MS Steel International - UAE
- GN Power Mariveles Coal Plant, Philippines
- Chettinad Cement Corporation Ltd - India
- Salva Resources Pvt Ltd - India
- Commonwealth Bank - Australia
- Coal and Oil Company - UAE
- Mjunction Services Limited - India
- Karaikal Port Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Sical Logistics Limited - India
- Deloitte Consulting - India
- GAC Shipping (India) Pvt Ltd
- Georgia Ports Authority, United States
- Latin American Coal - Colombia
- Mercator Lines Limited - India
- Indonesian Coal Mining Association
- Minerals Council of Australia
- Parliament of New Zealand
- Sarangani Energy Corporation, Philippines
- Heidelberg Cement - Germany
- New Zealand Coal & Carbon
- Cigading International Bulk Terminal - Indonesia
- Samtan Co., Ltd - South Korea
- LBH Netherlands Bv - Netherlands
- Wood Mackenzie - Singapore
- Rio Tinto Coal - Australia
- Tata Chemicals Ltd - India
- Altura Mining Limited, Indonesia
- Ministry of Transport, Egypt
- Dalmia Cement Bharat India
- Mercuria Energy - Indonesia
- Orica Australia Pty. Ltd.
- Bukit Makmur.PT - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Bhatia International Limited - India
- IEA Clean Coal Centre - UK
- Leighton Contractors Pty Ltd - Australia
- Simpson Spence & Young - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Central Electricity Authority - India
- Savvy Resources Ltd - HongKong
- Parry Sugars Refinery, India
- The Treasury - Australian Government
- South Luzon Thermal Energy Corporation
- Central Java Power - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- White Energy Company Limited
- Planning Commission, India
- Borneo Indobara - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Makarim & Taira - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Chamber of Mines of South Africa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indian Oil Corporation Limited
- Neyveli Lignite Corporation Ltd, - India
- International Coal Ventures Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Oldendorff Carriers - Singapore
- Indika Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Metalloyd Limited - United Kingdom
- Bangladesh Power Developement Board
- Kohat Cement Company Ltd. - Pakistan
- Meenaskhi Energy Private Limited - India
- Iligan Light & Power Inc, Philippines
- Therma Luzon, Inc, Philippines
- Antam Resourcindo - Indonesia
- Meralco Power Generation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ceylon Electricity Board - Sri Lanka
- Attock Cement Pakistan Limited
- Energy Link Ltd, New Zealand
- Semirara Mining Corp, Philippines
- SMC Global Power, Philippines
- Gujarat Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Power Finance Corporation Ltd., India
- India Bulls Power Limited - India
- Energy Development Corp, Philippines
- Wilmar Investment Holdings
- Carbofer General Trading SA - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Toyota Tsusho Corporation, Japan
- GVK Power & Infra Limited - India
- Sindya Power Generating Company Private Ltd
- Thiess Contractors Indonesia
- Banpu Public Company Limited - Thailand
- Directorate Of Revenue Intelligence - India
- IHS Mccloskey Coal Group - USA
- Eastern Coal Council - USA
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Mines - Canada
- Bhoruka Overseas - Indonesia
- CNBM International Corporation - China
- Sojitz Corporation - Japan
- TeaM Sual Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Independent Power Producers Association of India
- Posco Energy - South Korea
- Price Waterhouse Coopers - Russia
- PTC India Limited - India
- Baramulti Group, Indonesia
- Australian Commodity Traders Exchange
- Xindia Steels Limited - India
- Interocean Group of Companies - India
- Vizag Seaport Private Limited - India
- Krishnapatnam Port Company Ltd. - India
- Riau Bara Harum - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- ICICI Bank Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Pendopo Energi Batubara - Indonesia
- Petron Corporation, Philippines
- Economic Council, Georgia
- Gujarat Sidhee Cement - India
- Bahari Cakrawala Sebuku - Indonesia
- Indogreen Group - Indonesia
- Coastal Gujarat Power Limited - India
- Singapore Mercantile Exchange
- Cement Manufacturers Association - India
- Renaissance Capital - South Africa
- Mintek Dendrill Indonesia
- Goldman Sachs - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Africa Commodities Group - South Africa
- Trasteel International SA, Italy
- VISA Power Limited - India
- Alfred C Toepfer International GmbH - Germany
- Timah Investasi Mineral - Indoneisa
- Madhucon Powers Ltd - India
- Standard Chartered Bank - UAE
- Maheswari Brothers Coal Limited - India
- Thai Mozambique Logistica
- Sakthi Sugars Limited - India
- Billiton Holdings Pty Ltd - Australia
- ASAPP Information Group - India
- Bayan Resources Tbk. - Indonesia
- Globalindo Alam Lestari - Indonesia
- Ministry of Finance - Indonesia
- Binh Thuan Hamico - Vietnam
- Jaiprakash Power Ventures ltd
- Jorong Barutama Greston.PT - Indonesia
- Straits Asia Resources Limited - Singapore
- Vedanta Resources Plc - India
- Merrill Lynch Commodities Europe
- Manunggal Multi Energi - Indonesia
- Coalindo Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Aditya Birla Group - India
- London Commodity Brokers - England
- European Bulk Services B.V. - Netherlands
- Karbindo Abesyapradhi - Indoneisa
- Global Business Power Corporation, Philippines
- Siam City Cement - Thailand
- San Jose City I Power Corp, Philippines
- Kumho Petrochemical, South Korea
- Marubeni Corporation - India
- Rashtriya Ispat Nigam Limited - India
- Barasentosa Lestari - Indonesia
- SN Aboitiz Power Inc, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Malabar Cements Ltd - India
- OPG Power Generation Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Bulk Trading Sa - Switzerland
- Formosa Plastics Group - Taiwan
- PetroVietnam Power Coal Import and Supply Company
- Maharashtra Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Lanco Infratech Ltd - India
- Edison Trading Spa - Italy
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