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Wednesday, 24 February 16
THIRTEEN - NOT ALWAYS AN UNLUCKY NUMBER? - CLARKSONS
 Back in early 1999 the price of a 5 year old Panamax bulkcarrier dipped to $13.5m, and ever since analysts have hailed purchase decisions made at that time as some of the most lucrative shipping deals ever seen. Today, with the price back at $13m, perhaps it’s a good time to reflect on how successful investors were back in 1999 and whether there are similar opportunities once again.
What Was The Deal?
The graph shows for each year since 1990 the return that would have been generated by the purchase of a 5 year old Panamax bulkcarrier at the start of the year, the subsequent operation for ten years at the prevailing one year timecharter rate and then the sale of the unit at the end of that period as a 15 year old (for units purchased in 2007 and later, disposal at start 2016 was assumed). At the end of 1999 investors could pick up a 5 year old Panamax bulker for $14m. Trading that vessel at the start year one year timecharter rate for 10 years would have generated estimated earnings of $66.5m (after opex), and then as a 15 year old unit in 2009 the vessel could have been sold for $12.5m. That’s a small loss of $1.5m on the asset but still a total return of $65m, and an impressive internal rate of return (IRR) of 26%.
Playing Snap
A few years later, 5 year old Panamax bulkcarrier purchases did perhaps even better. Buying a 5 year old in 2002, once again at $14m, trading at the timecharter rate and selling as a 15 year old would have generated total returns of $73.2m and an IRR of 41%, whilst the equivalent project in 2003 would have generated $66.1m and an IRR of 44%. These vessels would have generated boom earnings earlier in the project period, subject to a heavier weighting in terms of the internal rate of return calculation.
Not Always A Good Hand
However, not all investors are so lucky. In this example, 5 year old ships purchased since 2008 (and sold this year, so admittedly with less time to hit upon a period of boom earnings) generated negative returns, and those purchased pre-1995 an average IRR of 7%. Buyers in 2008 would have lost a whopping $82.1m on the asset. Nevertheless, there was clearly a golden period; in the years 1998-2006 investors would have achieved an IRR ranging between 20% and 44%.
Unlucky (Or Lucky) 13?
So for those who have had the stomach to buy in at difficult times, there have been more than ample rewards. Today the price of a 5 year old Panamax is back at $13m. Dry bulk fundamentals, particularly on the demand side with the Chinese economy maturing, don’t look helpful at all (see SIW 1207), but with the 5 year old price at almost half that of a newbuild, who really knows what the longer-term opportunity might be?
Fortune favours the brave, but they also say that fools rush in. The outlook seems scary but investors might also have half an eye on their peers who invested at low points in the price cycle in the past. That’s the beauty of volatile and cyclical sectors, but it’s tricky food for thought for shipping investors. Are they willing to party like it’s 1999? Have a nice day.
Source: Clarksons
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Tuesday, 12 April 16
NO FURTHER SIGNIFICANT COAL PRICE DECLINES IN THE FUTURE - FITCH
COALspot.com: Fitch does not expect further significant coal price declines because producers sector-wide are suffering losses while China and Indo ...
Monday, 11 April 16
ON THE TIGHTROPE, IT CAN BE HARD TO KEEP YOUR BALANCE.... - CLARKSONS
Today’s headlines often point towards the impact of the demand side on the state of health of the shipping markets. But despite the fact that ...
Monday, 11 April 16
WEEKLY CS (I) COAL INDEX FOR 5700 GAR COAL UP 0.03 CENTS, OR ABOUT 0.06 PERCENT, TO $48.21 A TON
COALspot.com: Average 5000 GAR coal index of Indonesian origin fell 0.15 percent week over week to averaging $38.82 per ton on this past Friday, ac ...
Monday, 11 April 16
COAL IS NOT THE ENEMY TO FIGHT - ANDREA CLAVARINO, ASSOCARBONI
COALspot.com: “Coal is not the enemy to fight and electricity production from coal has an environmental impact in its lifecycle similar to na ...
Monday, 11 April 16
FORTY INDIAN COAL IMPORTERS UNDER THE DRI SCANNER FOR OVER-INVOICING : HINDU BUSINESS LINE
The Finance Ministry and the Directorate of Revenue Intelligence (DRI) of India are said to have stepped up investigations into the alleged over-in ...
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Showing 2481 to 2485 news of total 6871 |
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- SMC Global Power, Philippines
- Oldendorff Carriers - Singapore
- McConnell Dowell - Australia
- Kalimantan Lumbung Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Videocon Industries ltd - India
- Trasteel International SA, Italy
- Petrochimia International Co. Ltd.- Taiwan
- Minerals Council of Australia
- OPG Power Generation Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Maheswari Brothers Coal Limited - India
- ICICI Bank Limited - India
- Kobexindo Tractors - Indoneisa
- CIMB Investment Bank - Malaysia
- Aditya Birla Group - India
- Vedanta Resources Plc - India
- Kohat Cement Company Ltd. - Pakistan
- Global Business Power Corporation, Philippines
- Indogreen Group - Indonesia
- Coal and Oil Company - UAE
- Essar Steel Hazira Ltd - India
- Ministry of Mines - Canada
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- Independent Power Producers Association of India
- Chettinad Cement Corporation Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Rio Tinto Coal - Australia
- Pendopo Energi Batubara - Indonesia
- Romanian Commodities Exchange
- Orica Mining Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Orica Australia Pty. Ltd.
- Goldman Sachs - Singapore
- Krishnapatnam Port Company Ltd. - India
- Leighton Contractors Pty Ltd - Australia
- Sical Logistics Limited - India
- Australian Coal Association
- Energy Development Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Karaikal Port Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Anglo American - United Kingdom
- Alfred C Toepfer International GmbH - Germany
- South Luzon Thermal Energy Corporation
- Ambuja Cements Ltd - India
- Bukit Makmur.PT - Indonesia
- GMR Energy Limited - India
- Gujarat Sidhee Cement - India
- Indian Energy Exchange, India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Metalloyd Limited - United Kingdom
- Iligan Light & Power Inc, Philippines
- Merrill Lynch Commodities Europe
- Tamil Nadu electricity Board
- Xindia Steels Limited - India
- Parliament of New Zealand
- Interocean Group of Companies - India
- Toyota Tsusho Corporation, Japan
- Salva Resources Pvt Ltd - India
- Cement Manufacturers Association - India
- Latin American Coal - Colombia
- Barasentosa Lestari - Indonesia
- Heidelberg Cement - Germany
- International Coal Ventures Pvt Ltd - India
- Singapore Mercantile Exchange
- Eastern Energy - Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Georgia Ports Authority, United States
- Pipit Mutiara Jaya. PT, Indonesia
- Coalindo Energy - Indonesia
- MS Steel International - UAE
- Bayan Resources Tbk. - Indonesia
- Banpu Public Company Limited - Thailand
- GVK Power & Infra Limited - India
- Sree Jayajothi Cements Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Marubeni Corporation - India
- Borneo Indobara - Indonesia
- India Bulls Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Sarangani Energy Corporation, Philippines
- Parry Sugars Refinery, India
- Straits Asia Resources Limited - Singapore
- Directorate Of Revenue Intelligence - India
- New Zealand Coal & Carbon
- Intertek Mineral Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Grasim Industreis Ltd - India
- Jindal Steel & Power Ltd - India
- Electricity Generating Authority of Thailand
- Wilmar Investment Holdings
- Kumho Petrochemical, South Korea
- IEA Clean Coal Centre - UK
- Globalindo Alam Lestari - Indonesia
- PowerSource Philippines DevCo
- Indonesian Coal Mining Association
- Directorate General of MIneral and Coal - Indonesia
- Larsen & Toubro Limited - India
- GAC Shipping (India) Pvt Ltd
- Savvy Resources Ltd - HongKong
- Meenaskhi Energy Private Limited - India
- Price Waterhouse Coopers - Russia
- Australian Commodity Traders Exchange
- Mercator Lines Limited - India
- Ministry of Transport, Egypt
- Bharathi Cement Corporation - India
- Ceylon Electricity Board - Sri Lanka
- Chamber of Mines of South Africa
- Central Electricity Authority - India
- Meralco Power Generation, Philippines
- Africa Commodities Group - South Africa
- Indika Energy - Indonesia
- Sojitz Corporation - Japan
- Dalmia Cement Bharat India
- Agrawal Coal Company - India
- Thai Mozambique Logistica
- Renaissance Capital - South Africa
- Neyveli Lignite Corporation Ltd, - India
- Indo Tambangraya Megah - Indonesia
- Carbofer General Trading SA - India
- Siam City Cement - Thailand
- Star Paper Mills Limited - India
- Ind-Barath Power Infra Limited - India
- Bangladesh Power Developement Board
- Binh Thuan Hamico - Vietnam
- PTC India Limited - India
- Wood Mackenzie - Singapore
- Semirara Mining Corp, Philippines
- Vizag Seaport Private Limited - India
- London Commodity Brokers - England
- Therma Luzon, Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Cigading International Bulk Terminal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Ministry of Finance - Indonesia
- Altura Mining Limited, Indonesia
- Deloitte Consulting - India
- Bhoruka Overseas - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- The State Trading Corporation of India Ltd
- Mintek Dendrill Indonesia
- Kepco SPC Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- The Treasury - Australian Government
- LBH Netherlands Bv - Netherlands
- Rashtriya Ispat Nigam Limited - India
- Kaltim Prima Coal - Indonesia
- Indian Oil Corporation Limited
- Sakthi Sugars Limited - India
- Uttam Galva Steels Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Mercuria Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Planning Commission, India
- Riau Bara Harum - Indonesia
- Siam City Cement PLC, Thailand
- Posco Energy - South Korea
- Antam Resourcindo - Indonesia
- Central Java Power - Indonesia
- Mjunction Services Limited - India
- Makarim & Taira - Indonesia
- Attock Cement Pakistan Limited
- Jaiprakash Power Ventures ltd
- Bulk Trading Sa - Switzerland
- Bukit Baiduri Energy - Indonesia
- Timah Investasi Mineral - Indoneisa
- Malabar Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Samtan Co., Ltd - South Korea
- Formosa Plastics Group - Taiwan
- Petron Corporation, Philippines
- Economic Council, Georgia
- Holcim Trading Pte Ltd - Singapore
- San Jose City I Power Corp, Philippines
- Standard Chartered Bank - UAE
- Karbindo Abesyapradhi - Indoneisa
- Bhatia International Limited - India
- Gujarat Electricity Regulatory Commission - India
- TeaM Sual Corporation - Philippines
- White Energy Company Limited
- Semirara Mining and Power Corporation, Philippines
- Madhucon Powers Ltd - India
- Power Finance Corporation Ltd., India
- IHS Mccloskey Coal Group - USA
- Energy Link Ltd, New Zealand
- Tata Chemicals Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhushan Steel Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Commonwealth Bank - Australia
- Lanco Infratech Ltd - India
- Eastern Coal Council - USA
- Offshore Bulk Terminal Pte Ltd, Singapore
- Manunggal Multi Energi - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Medco Energi Mining Internasional
- CNBM International Corporation - China
- VISA Power Limited - India
- Coastal Gujarat Power Limited - India
- Port Waratah Coal Services - Australia
- Electricity Authority, New Zealand
- Edison Trading Spa - Italy
- SMG Consultants - Indonesia
- The University of Queensland
- Global Coal Blending Company Limited - Australia
- Sinarmas Energy and Mining - Indonesia
- Global Green Power PLC Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Baramulti Group, Indonesia
- Thiess Contractors Indonesia
- European Bulk Services B.V. - Netherlands
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