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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, 03 September 15
MINISTRY OF ENERGY AND MINERAL RESOURCES OF INDONESIA TO REVISE HBA METHODOLOGY
COALspot.com: Ministry of Energy and Mineral Resources (ESDM) in process to revise Indonesian Coal Price Reference (HBA) and expected to complete b ...
Thursday, 03 September 15
THE CHINESE STOCK MARKET AND THE CHINESE ECONOMY CONTINUE TO SUBSTANTIALLY AFFECT TRADING - INTERMODAL
The last week of the summer season saw the BDI dipping further on the back of another significant drop in rates for Capes, which brought the market ...
Wednesday, 02 September 15
PORT OF NEWCASTLE SHIPPED 13.46 MMT OF COAL IN JULY; UP 0.66 PER CENT M-O-M
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port, has shipped $1.224 billi ...
Wednesday, 02 September 15
SHIPPING MARKET INSIGHT - GEORGE ILIOPOULOS
In the beginning of the summer period SnP activity was firm with numerous buyers, coming mainly from Greece and the Far East, inspecting ships and ...
Tuesday, 01 September 15
FOB INDONESIA COAL SWAPS FURTHER SLIDE TO US$ 40.62 PMT; DECLINE 5.34 PERCENT M-O-M
COALspot.com: Indonesian coal swap for delivery 4Q 2015 declined month on month and slightly dropped week over week.
The 4Q swap was declined ...
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Showing 2836 to 2840 news of total 6871 |
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- PTC India Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- New Zealand Coal & Carbon
- Therma Luzon, Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Antam Resourcindo - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- SN Aboitiz Power Inc, Philippines
- Commonwealth Bank - Australia
- Dalmia Cement Bharat India
- MS Steel International - UAE
- Vedanta Resources Plc - India
- Toyota Tsusho Corporation, Japan
- Rashtriya Ispat Nigam Limited - India
- Australian Commodity Traders Exchange
- Thiess Contractors Indonesia
- Oldendorff Carriers - Singapore
- Indonesian Coal Mining Association
- Mjunction Services Limited - India
- Global Green Power PLC Corporation, Philippines
- Sical Logistics Limited - India
- Singapore Mercantile Exchange
- Indo Tambangraya Megah - Indonesia
- Electricity Generating Authority of Thailand
- Leighton Contractors Pty Ltd - Australia
- Straits Asia Resources Limited - Singapore
- Minerals Council of Australia
- Parry Sugars Refinery, India
- Medco Energi Mining Internasional
- Star Paper Mills Limited - India
- Agrawal Coal Company - India
- European Bulk Services B.V. - Netherlands
- Uttam Galva Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Ministry of Transport, Egypt
- Wilmar Investment Holdings
- Kapuas Tunggal Persada - Indonesia
- Electricity Authority, New Zealand
- Marubeni Corporation - India
- VISA Power Limited - India
- Global Business Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Bhushan Steel Limited - India
- Jaiprakash Power Ventures ltd
- Latin American Coal - Colombia
- Billiton Holdings Pty Ltd - Australia
- San Jose City I Power Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Mercator Lines Limited - India
- Vizag Seaport Private Limited - India
- Bhoruka Overseas - Indonesia
- Intertek Mineral Services - Indonesia
- Planning Commission, India
- Sakthi Sugars Limited - India
- Semirara Mining Corp, Philippines
- Ministry of Mines - Canada
- Renaissance Capital - South Africa
- Bangladesh Power Developement Board
- Interocean Group of Companies - India
- Edison Trading Spa - Italy
- Vijayanagar Sugar Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Grasim Industreis Ltd - India
- Global Coal Blending Company Limited - Australia
- Chettinad Cement Corporation Ltd - India
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Bhatia International Limited - India
- Aboitiz Power Corporation - Philippines
- Cement Manufacturers Association - India
- Gujarat Mineral Development Corp Ltd - India
- Wood Mackenzie - Singapore
- The State Trading Corporation of India Ltd
- Timah Investasi Mineral - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Madhucon Powers Ltd - India
- ASAPP Information Group - India
- Bayan Resources Tbk. - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maharashtra Electricity Regulatory Commission - India
- Altura Mining Limited, Indonesia
- Coal and Oil Company - UAE
- Petron Corporation, Philippines
- Mintek Dendrill Indonesia
- The Treasury - Australian Government
- Formosa Plastics Group - Taiwan
- Indika Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Thai Mozambique Logistica
- Bharathi Cement Corporation - India
- Simpson Spence & Young - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- International Coal Ventures Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- PNOC Exploration Corporation - Philippines
- Independent Power Producers Association of India
- Trasteel International SA, Italy
- CIMB Investment Bank - Malaysia
- Sojitz Corporation - Japan
- Sarangani Energy Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Borneo Indobara - Indonesia
- Georgia Ports Authority, United States
- Globalindo Alam Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- IEA Clean Coal Centre - UK
- Riau Bara Harum - Indonesia
- Indian Oil Corporation Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- GMR Energy Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Orica Australia Pty. Ltd.
- Energy Development Corp, Philippines
- Standard Chartered Bank - UAE
- Jindal Steel & Power Ltd - India
- Orica Mining Services - Indonesia
- Larsen & Toubro Limited - India
- PetroVietnam Power Coal Import and Supply Company
- ICICI Bank Limited - India
- Romanian Commodities Exchange
- Deloitte Consulting - India
- Kideco Jaya Agung - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Metalloyd Limited - United Kingdom
- CNBM International Corporation - China
- Ministry of Finance - Indonesia
- Bukit Makmur.PT - Indonesia
- Salva Resources Pvt Ltd - India
- Meralco Power Generation, Philippines
- Coalindo Energy - Indonesia
- IHS Mccloskey Coal Group - USA
- Semirara Mining and Power Corporation, Philippines
- India Bulls Power Limited - India
- Samtan Co., Ltd - South Korea
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Tamil Nadu electricity Board
- Bulk Trading Sa - Switzerland
- Coastal Gujarat Power Limited - India
- Tata Chemicals Ltd - India
- Karaikal Port Pvt Ltd - India
- Africa Commodities Group - South Africa
- Baramulti Group, Indonesia
- White Energy Company Limited
- Siam City Cement - Thailand
- Mercuria Energy - Indonesia
- Goldman Sachs - Singapore
- PowerSource Philippines DevCo
- Indogreen Group - Indonesia
- Ambuja Cements Ltd - India
- Kaltim Prima Coal - Indonesia
- Aditya Birla Group - India
- Siam City Cement PLC, Thailand
- Carbofer General Trading SA - India
- Bukit Asam (Persero) Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Meenaskhi Energy Private Limited - India
- McConnell Dowell - Australia
- London Commodity Brokers - England
- Rio Tinto Coal - Australia
- Merrill Lynch Commodities Europe
- Sree Jayajothi Cements Limited - India
- Miang Besar Coal Terminal - Indonesia
- Indian Energy Exchange, India
- Iligan Light & Power Inc, Philippines
- South Luzon Thermal Energy Corporation
- Essar Steel Hazira Ltd - India
- The University of Queensland
- Eastern Energy - Thailand
- AsiaOL BioFuels Corp., Philippines
- Xindia Steels Limited - India
- Gujarat Sidhee Cement - India
- Sindya Power Generating Company Private Ltd
- GAC Shipping (India) Pvt Ltd
- Maheswari Brothers Coal Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Barasentosa Lestari - Indonesia
- Australian Coal Association
- Kumho Petrochemical, South Korea
- Savvy Resources Ltd - HongKong
- Port Waratah Coal Services - Australia
- Cigading International Bulk Terminal - Indonesia
- Videocon Industries ltd - India
- TeaM Sual Corporation - Philippines
- Ind-Barath Power Infra Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Central Java Power - Indonesia
- Anglo American - United Kingdom
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Central Electricity Authority - India
- Lanco Infratech Ltd - India
- Makarim & Taira - Indonesia
- Eastern Coal Council - USA
- Attock Cement Pakistan Limited
- Pipit Mutiara Jaya. PT, Indonesia
- Energy Link Ltd, New Zealand
- Posco Energy - South Korea
- Price Waterhouse Coopers - Russia
- Power Finance Corporation Ltd., India
- Economic Council, Georgia
- LBH Netherlands Bv - Netherlands
- GVK Power & Infra Limited - India
- Banpu Public Company Limited - Thailand
- Directorate Of Revenue Intelligence - India
- SMC Global Power, Philippines
- SMG Consultants - Indonesia
- Heidelberg Cement - Germany
- Chamber of Mines of South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Parliament of New Zealand
- Manunggal Multi Energi - Indonesia
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