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Monday, 05 September 16
POOR FREIGHT RATES DESPITE STRONG DEMAND GROWTH FROM CHINA - BIMCO
 Demand
The dry bulk commodity imports into and exports out of China we have seen in the first half of 2016 are very positive – and nothing short of extraordinary. But, putting it into perspective, compared to the devastating freight rate levels over the same period, it highlights that something is very wrong in the dry bulk market. The market is nowhere near balanced.
BIMCO’s data on seaborne iron ore imports into China, shows a growth of 9.6% for H1-2016 as compared to H1-2015. With seaborne coal volumes shipped into China during H1-2016 being on par with H2-2015, this represents a 5.0% growth on H1-2015. A continued surge in thermal coal imports seems limited, as hydropower electricity generation due to heavy rainfall is likely to squeeze coal consumption (used for power generation) yet again.
Among the minor seaborne commodities, Chinese steel product exports continue to support its high steel production – and therefore also the elevated imports of iron ore. Exports are up by 9.4% in H1-2016 compared to the same period last year. Trade barriers being set up against Chinese steel, primarily in the Western hemisphere, have little impact as most steel is exported to other Asian countries. Steel exports have been a steady and solid trade compared to Chinese coal imports, which were down in Jan/Feb but very strong in May/June.
Also as expected we saw a new record of grain exports out of Argentina during H1-2016. Up by 42.1% year on year.
At the same time, we witnessed appalling freight rates during the worst quarter ever (Q1-2016) making it a terrible first half of 2016. Year to date, the Baltic Dry Index is down by 26% on last year’s performance, which was already dreadful.
On 10 August, freight rate levels are merely covering operational expenditures (OPEX), with no contribution to cover overhead and financing costs. BIMCO expects the industry to be loss making for the full year.
The devastating freight rates have left asset values for dry bulk ships battered. A 2010-built cape size ship was valued by VesselsValue.com on 1 August 2014 at USD 49.75 million. Two years later, that same ship had lost 57.3% of its value and is now worth only USD 21.25 million. The pain is felt across the fleet; worse for older ships and slightly less severe a drop in value for newer ships.
Outlook
Positive demand growth rates across the board for dry bulk commodities are high, and there is one that is ruling them all - iron ore. In H1-2016 we saw a volume growth of 42 million tonnes of iron ore going into China, compared to a combined volume growth of 12 million tonnes for coal, soybeans and steel products on other Chinese trades.
Increasing demand for iron ore is strong on the best trade lane of them all - Brazil to China. Shipments on that trade were up by 24% to reach 98 million tonnes in H1-2016 compared to H1-2015. Such a development used to mean much higher freight rates, but as 2015 passed, spot rates for capesize ships were only modestly buoyed by volume growth on this trade. BIMCO believes that a significant part of the iron ore has been transported on “Vale’s conveyor belt of Chinese-owned VLOCs”. If this continues to remove cargoes from the open market, volume growth on the Brazil to China iron ore trade - once the greatest driver of freight rates in the spot market - will no longer affect the spot market on this trade nor the general freight market significantly.
Handymax ships, on the other hand, have seen a flurry of new ships delivered and have fared well due to the broad-based demand growth outside the iron ore market. They will continue to do so. The fast growing handymax fleet, however, will also going forward put a lid on shipowners and operators’ chances of lifting freight rates into really profitable levels.
Growing iron ore imports have not meant higher steel production in China. We can conclude that some of the much-needed substitution away from domestically mined, poor quality ore towards the import of higher iron content quality ores, and is happening at a fair pace.
This has stirred a surprising move by the Metallurgical Miners' Association of China (MMAC) who say the big three iron ore producers are “using low-priced dumping to crowd out higher-cost producers [in China]”. They claim 329 mines were shut last year and another 793 closed in the first five months of 2016. The MMAC crying foul is unprecedented. But for the dry bulk shipping industry, substituting the higher cost produced ore in China delivers much-needed volume growth at sea.
For the coming months: September-November, BIMCO expects transported volumes to stay put - as the high volumes transported in recent months may have run ahead of underlying demand. Expect the freight rates to move up, down and sideways before moving up again in the fourth quarter of the year.
Source: BIMCO
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Tuesday, 23 August 16
4200 GAR COAL INDEX CLIMB 15.96% YEAR TO DATE - CS COAL INDEX
COALspot.com: Average 4200 GAR coal index of Indonesian origin rose 1.65 % week over week to averaging $31.46 per ton this past week, shows CS (i) ...
Tuesday, 23 August 16
KOMIPO TO IMPORT 250K OF 5,700 KCAL/KG NAR COAL FOR Q4' 16
COALspot.com: South Korea state-owned utility Korea Midland Power (KOMIPO) issued a new tender for total 250,000 Metric Tons of Bituminous Coal for ...
Monday, 22 August 16
INDONESIA'S CS 5000 GAR THERMAL COAL INDEX, ROSE TO A 57-WEEKS HIGH TO TOP $43.47 A TON
COALspot.com: Indonesia’s CS 5000 GAR thermal coal index, rose to a 57-weeks high to top $US43. 47 a ton in the latest week, extending a 18-w ...
Monday, 22 August 16
THE FREIGHT MARKET WAS STEADY THIS PAST WEEK; CAPE INDEX DECLINE 5.38%
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities rose and ending in a positive note this past week except ...
Friday, 19 August 16
U.S. YEAR-TO-DATE COAL PRODUCTION TOTALLED AN ESTIMATED 421.6 MMST
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 15.8 million short ton ...
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Showing 2311 to 2315 news of total 6871 |
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- Bulk Trading Sa - Switzerland
- Pipit Mutiara Jaya. PT, Indonesia
- Barasentosa Lestari - Indonesia
- Vizag Seaport Private Limited - India
- Kumho Petrochemical, South Korea
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- Sree Jayajothi Cements Limited - India
- Eastern Coal Council - USA
- South Luzon Thermal Energy Corporation
- Leighton Contractors Pty Ltd - Australia
- Posco Energy - South Korea
- Tamil Nadu electricity Board
- Cement Manufacturers Association - India
- CIMB Investment Bank - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- GVK Power & Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Wood Mackenzie - Singapore
- Grasim Industreis Ltd - India
- Wilmar Investment Holdings
- Georgia Ports Authority, United States
- Samtan Co., Ltd - South Korea
- Bharathi Cement Corporation - India
- TeaM Sual Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- VISA Power Limited - India
- Mjunction Services Limited - India
- Globalindo Alam Lestari - Indonesia
- Bukit Makmur.PT - Indonesia
- Ambuja Cements Ltd - India
- Toyota Tsusho Corporation, Japan
- Banpu Public Company Limited - Thailand
- Holcim Trading Pte Ltd - Singapore
- New Zealand Coal & Carbon
- Kapuas Tunggal Persada - Indonesia
- Lanco Infratech Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Global Coal Blending Company Limited - Australia
- Oldendorff Carriers - Singapore
- Singapore Mercantile Exchange
- Parry Sugars Refinery, India
- Attock Cement Pakistan Limited
- Edison Trading Spa - Italy
- Ministry of Finance - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Ministry of Mines - Canada
- Central Java Power - Indonesia
- Star Paper Mills Limited - India
- OPG Power Generation Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Australian Commodity Traders Exchange
- Meenaskhi Energy Private Limited - India
- Binh Thuan Hamico - Vietnam
- Kobexindo Tractors - Indoneisa
- Essar Steel Hazira Ltd - India
- International Coal Ventures Pvt Ltd - India
- CNBM International Corporation - China
- Borneo Indobara - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Chettinad Cement Corporation Ltd - India
- Simpson Spence & Young - Indonesia
- Kepco SPC Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Makarim & Taira - Indonesia
- GAC Shipping (India) Pvt Ltd
- European Bulk Services B.V. - Netherlands
- Intertek Mineral Services - Indonesia
- Baramulti Group, Indonesia
- Meralco Power Generation, Philippines
- Indonesian Coal Mining Association
- ASAPP Information Group - India
- MS Steel International - UAE
- Bhoruka Overseas - Indonesia
- Minerals Council of Australia
- Indo Tambangraya Megah - Indonesia
- The Treasury - Australian Government
- Rio Tinto Coal - Australia
- Thai Mozambique Logistica
- Interocean Group of Companies - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Trasteel International SA, Italy
- Medco Energi Mining Internasional
- Coastal Gujarat Power Limited - India
- Madhucon Powers Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Metalloyd Limited - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- Rashtriya Ispat Nigam Limited - India
- Malabar Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Port Waratah Coal Services - Australia
- Tata Chemicals Ltd - India
- Agrawal Coal Company - India
- Price Waterhouse Coopers - Russia
- McConnell Dowell - Australia
- Renaissance Capital - South Africa
- Parliament of New Zealand
- Aditya Birla Group - India
- Kideco Jaya Agung - Indonesia
- Salva Resources Pvt Ltd - India
- Deloitte Consulting - India
- Chamber of Mines of South Africa
- PetroVietnam Power Coal Import and Supply Company
- Directorate Of Revenue Intelligence - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Heidelberg Cement - Germany
- Timah Investasi Mineral - Indoneisa
- GMR Energy Limited - India
- Ind-Barath Power Infra Limited - India
- IHS Mccloskey Coal Group - USA
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMC Global Power, Philippines
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- The State Trading Corporation of India Ltd
- Kalimantan Lumbung Energi - Indonesia
- Standard Chartered Bank - UAE
- Semirara Mining Corp, Philippines
- San Jose City I Power Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Sakthi Sugars Limited - India
- LBH Netherlands Bv - Netherlands
- Ceylon Electricity Board - Sri Lanka
- Indian Oil Corporation Limited
- Independent Power Producers Association of India
- Energy Development Corp, Philippines
- Coal and Oil Company - UAE
- Videocon Industries ltd - India
- Economic Council, Georgia
- AsiaOL BioFuels Corp., Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Bahari Cakrawala Sebuku - Indonesia
- Mercator Lines Limited - India
- SN Aboitiz Power Inc, Philippines
- Carbofer General Trading SA - India
- Directorate General of MIneral and Coal - Indonesia
- Anglo American - United Kingdom
- Gujarat Sidhee Cement - India
- Planning Commission, India
- Asmin Koalindo Tuhup - Indonesia
- Merrill Lynch Commodities Europe
- Jorong Barutama Greston.PT - Indonesia
- Electricity Generating Authority of Thailand
- Kartika Selabumi Mining - Indonesia
- ICICI Bank Limited - India
- Ministry of Transport, Egypt
- Billiton Holdings Pty Ltd - Australia
- Petron Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Straits Asia Resources Limited - Singapore
- Sindya Power Generating Company Private Ltd
- Eastern Energy - Thailand
- Marubeni Corporation - India
- Maheswari Brothers Coal Limited - India
- Karaikal Port Pvt Ltd - India
- PowerSource Philippines DevCo
- Riau Bara Harum - Indonesia
- Latin American Coal - Colombia
- Goldman Sachs - Singapore
- SMG Consultants - Indonesia
- Orica Mining Services - Indonesia
- Kaltim Prima Coal - Indonesia
- Sojitz Corporation - Japan
- Energy Link Ltd, New Zealand
- Bangladesh Power Developement Board
- Petrochimia International Co. Ltd.- Taiwan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- The University of Queensland
- Siam City Cement PLC, Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Dalmia Cement Bharat India
- Therma Luzon, Inc, Philippines
- Bhushan Steel Limited - India
- Indika Energy - Indonesia
- PTC India Limited - India
- Commonwealth Bank - Australia
- Gujarat Electricity Regulatory Commission - India
- Formosa Plastics Group - Taiwan
- Jaiprakash Power Ventures ltd
- Mintek Dendrill Indonesia
- Larsen & Toubro Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Altura Mining Limited, Indonesia
- Global Business Power Corporation, Philippines
- Electricity Authority, New Zealand
- PNOC Exploration Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Coalindo Energy - Indonesia
- Vedanta Resources Plc - India
- London Commodity Brokers - England
- Mercuria Energy - Indonesia
- India Bulls Power Limited - India
- Indian Energy Exchange, India
- Sical Logistics Limited - India
- Jindal Steel & Power Ltd - India
- Manunggal Multi Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Power Finance Corporation Ltd., India
- Xindia Steels Limited - India
- Sarangani Energy Corporation, Philippines
- Uttam Galva Steels Limited - India
- Africa Commodities Group - South Africa
- Bhatia International Limited - India
- Karbindo Abesyapradhi - Indoneisa
- White Energy Company Limited
- Australian Coal Association
- Iligan Light & Power Inc, Philippines
- Thiess Contractors Indonesia
- Romanian Commodities Exchange
- Central Electricity Authority - India
- Indogreen Group - Indonesia
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