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Tuesday, 17 September 19
THE DRY BULK FREIGHT MARKET IS ALREADY ON A DOWNWARD CORRECTION - ALLIED
 Here we are again, just a breath before the final quarter of the year. Under typical circumstances and on the basis of what we have seen during the summer months, one would be (theoretically) extra bullish in terms of what to expect for the final part of 2019, said Thomas Chasapis, Research Analyst of Allied shipping Research in his latest report.
However, can the current positive dynamics be sustained over the next three months? According to Thomas Chasapis many views have been expressed in respect to the true state of the dry bulk market. At this point, it seems as though the most vital question is as to whether the market has any direction at all (with the hope of some sort rebalancing soon), or whether the recent summer trends in the freight market have created ample artificial noise in a market that is currently stagnant.
Thomas Chasapis further noted, the dry bulk freight market is already on a downward correction, hardly a surprise, given that the balance point of the market does not seem to be by any measure with a BDI of above 2,500bp (at least for now). This has been expressed emphatically in the paper market, with current forward curves indicating massive corrections moving forward. Notwithstanding this, future contracts for the BCI-5TC average for the final quarter have been formed at slightly above US$ 25,000/day. It is true that this level is an extreme discounted when compared to where the current freight market is at, but when we consider that we are talking about a 3-month average figure which is above US$ 10,000/day more than the year-to-date average.
Just remember what we were seeing for similar contracts exactly one year earlier and at what levels the market closed off the final three months of 2018. So, are we truly faced with a pessimistic view right now? The reality is slightly more ambiguous as we shift the focus over to the macroeconomic indicators. Y-o-y massive corrections have brought with them a huge wave of negativism towards the market.
According to Thomas Chasapis, forward contracts for 2020 felt a correction of around US$ 5,000/day, while 2021 and the years beyond that were a little less so effected though still noting significant corrections. All-in-all, even under these conditions, there are many positive indicators to be seen as well. If the current forward curve is "right", the freight market will be on time to catch-up and finish the year with an average of at least on par with that of 2018 (if not higher). Despite the impressive recovery, many will probably still view the year as a step back. However, it is interesting to note how this is translated when we assess asset prices into the mix? Taking as general indication the value of a 5yr old Capesize vessel, year-to-date the average figure has eased back by roughly 11%, while, given the overall stability of second hand values, we can expect this discount to remain relatively the same during the remaining months of the year. So, in terms of an earnings to price ratio analysis, this would suggest that the market is in a much better state (y-o -y) in relative terms. However, things change when we compare this to the risk profile involved. At this point, the excessive volatility levels noted in freight rates would point to the current prices being in theory fairly "expensive".
This however is only partially true, as volatility measures are agnostic to any market direction and only measure the difference from the average (either on the positive or the negative side). Given the aggressive upward movement in freight rates as of late, the standard deviation inevitably gives an exaggerated result. However, when you take into consideration what we have been seeing in the futures market, you may well find further ground to support the indication that has been given from the earnings to price ratio side, Thomas Chasapis concluded.
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Tuesday, 26 February 19
THE RELATIVELY DISAPPOINTING SCENE PORTRAYED IN THE DRY BULK MARKET RIGHT NOW - ALLIED SHIPBROKING
The relatively disappointing scene portrayed in the dry bulk market right now (especially in the Capesize segment) is undoubtedly one of the prevai ...
Friday, 22 February 19
AUSTRALIAN HIGH CV THERMAL COAL PRICES AT 19-MONTH LOW, BUT NOT FOR LONG - WOOD MACKENZIE
The benchmark Newcastle high energy thermal coal price has fallen from US$100/tonne at the turn of the new year to US$88/tonne. Thermal coal has be ...
Wednesday, 20 February 19
EFFECTIVE NOTICES OF ARBITRATION - AVOIDING WASTED COSTS AND A POTENTIALLY TIME-BARRED CLAIM
KNOWLEDGE TO ELEVATE
In a recent case, The Amity [2017], charterers successfully set aside an arbitration award on the basis that ow ...
Wednesday, 20 February 19
SHIPPING MARKET INSIGHT - INERMODAL
Market experts mostly agree that the recent dry bulk market downtrend was caused by seasonal slowdown amid the Chinese New Year celebrations in com ...
Tuesday, 19 February 19
AUSTRALIA'S COAL FUTURE UNDER THREAT AS MORE CHANGES HIT FOSSIL FUELS GLOBALLY - ABC
Two disparate decisions from opposite corners of the world have sounded warnings for the future of Australia’s coal industry.
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- Samtan Co., Ltd - South Korea
- Eastern Coal Council - USA
- GVK Power & Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Coastal Gujarat Power Limited - India
- SMC Global Power, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Heidelberg Cement - Germany
- Meralco Power Generation, Philippines
- Manunggal Multi Energi - Indonesia
- PTC India Limited - India
- Miang Besar Coal Terminal - Indonesia
- CNBM International Corporation - China
- The University of Queensland
- Dalmia Cement Bharat India
- Bhatia International Limited - India
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- Eastern Energy - Thailand
- Indika Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Bayan Resources Tbk. - Indonesia
- Grasim Industreis Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Savvy Resources Ltd - HongKong
- Kideco Jaya Agung - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- GN Power Mariveles Coal Plant, Philippines
- Bhoruka Overseas - Indonesia
- ICICI Bank Limited - India
- LBH Netherlands Bv - Netherlands
- Aboitiz Power Corporation - Philippines
- Riau Bara Harum - Indonesia
- Minerals Council of Australia
- Central Electricity Authority - India
- Tamil Nadu electricity Board
- Cement Manufacturers Association - India
- Port Waratah Coal Services - Australia
- Indian Oil Corporation Limited
- Energy Link Ltd, New Zealand
- Therma Luzon, Inc, Philippines
- IEA Clean Coal Centre - UK
- Bahari Cakrawala Sebuku - Indonesia
- Timah Investasi Mineral - Indoneisa
- Orica Mining Services - Indonesia
- The Treasury - Australian Government
- Karbindo Abesyapradhi - Indoneisa
- European Bulk Services B.V. - Netherlands
- Mjunction Services Limited - India
- Planning Commission, India
- Gujarat Mineral Development Corp Ltd - India
- Africa Commodities Group - South Africa
- Alfred C Toepfer International GmbH - Germany
- Leighton Contractors Pty Ltd - Australia
- Global Green Power PLC Corporation, Philippines
- Singapore Mercantile Exchange
- Aditya Birla Group - India
- Mintek Dendrill Indonesia
- International Coal Ventures Pvt Ltd - India
- Ambuja Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Medco Energi Mining Internasional
- Trasteel International SA, Italy
- SMG Consultants - Indonesia
- Thai Mozambique Logistica
- PowerSource Philippines DevCo
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Xindia Steels Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Simpson Spence & Young - Indonesia
- Kumho Petrochemical, South Korea
- Central Java Power - Indonesia
- IHS Mccloskey Coal Group - USA
- Toyota Tsusho Corporation, Japan
- The State Trading Corporation of India Ltd
- Kepco SPC Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Agrawal Coal Company - India
- TeaM Sual Corporation - Philippines
- Renaissance Capital - South Africa
- Tata Chemicals Ltd - India
- Indian Energy Exchange, India
- Bharathi Cement Corporation - India
- Goldman Sachs - Singapore
- Malabar Cements Ltd - India
- Bhushan Steel Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Georgia Ports Authority, United States
- Altura Mining Limited, Indonesia
- Baramulti Group, Indonesia
- Romanian Commodities Exchange
- Straits Asia Resources Limited - Singapore
- ASAPP Information Group - India
- Sical Logistics Limited - India
- Rio Tinto Coal - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indogreen Group - Indonesia
- Videocon Industries ltd - India
- Mercuria Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sojitz Corporation - Japan
- Posco Energy - South Korea
- Anglo American - United Kingdom
- Bulk Trading Sa - Switzerland
- Chettinad Cement Corporation Ltd - India
- Commonwealth Bank - Australia
- Kobexindo Tractors - Indoneisa
- Economic Council, Georgia
- Interocean Group of Companies - India
- Globalindo Alam Lestari - Indonesia
- Edison Trading Spa - Italy
- Marubeni Corporation - India
- Parliament of New Zealand
- Ind-Barath Power Infra Limited - India
- Semirara Mining and Power Corporation, Philippines
- Wilmar Investment Holdings
- Coal and Oil Company - UAE
- Intertek Mineral Services - Indonesia
- Independent Power Producers Association of India
- Electricity Generating Authority of Thailand
- Kapuas Tunggal Persada - Indonesia
- Kartika Selabumi Mining - Indonesia
- Semirara Mining Corp, Philippines
- White Energy Company Limited
- Standard Chartered Bank - UAE
- Billiton Holdings Pty Ltd - Australia
- Sakthi Sugars Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Thiess Contractors Indonesia
- Cigading International Bulk Terminal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Star Paper Mills Limited - India
- Iligan Light & Power Inc, Philippines
- Jindal Steel & Power Ltd - India
- Energy Development Corp, Philippines
- Australian Commodity Traders Exchange
- Siam City Cement - Thailand
- Deloitte Consulting - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indo Tambangraya Megah - Indonesia
- Sarangani Energy Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Parry Sugars Refinery, India
- Indonesian Coal Mining Association
- Barasentosa Lestari - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Australian Coal Association
- GAC Shipping (India) Pvt Ltd
- Chamber of Mines of South Africa
- Siam City Cement PLC, Thailand
- Petron Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- CIMB Investment Bank - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Global Business Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Attock Cement Pakistan Limited
- Directorate Of Revenue Intelligence - India
- Gujarat Electricity Regulatory Commission - India
- Kaltim Prima Coal - Indonesia
- Electricity Authority, New Zealand
- Holcim Trading Pte Ltd - Singapore
- Power Finance Corporation Ltd., India
- Binh Thuan Hamico - Vietnam
- GMR Energy Limited - India
- Global Coal Blending Company Limited - Australia
- Ministry of Mines - Canada
- New Zealand Coal & Carbon
- Sree Jayajothi Cements Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Transport, Egypt
- Larsen & Toubro Limited - India
- San Jose City I Power Corp, Philippines
- McConnell Dowell - Australia
- Karaikal Port Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Borneo Indobara - Indonesia
- India Bulls Power Limited - India
- PNOC Exploration Corporation - Philippines
- Sindya Power Generating Company Private Ltd
- Makarim & Taira - Indonesia
- Madhucon Powers Ltd - India
- Banpu Public Company Limited - Thailand
- Coalindo Energy - Indonesia
- Bangladesh Power Developement Board
- VISA Power Limited - India
- Mercator Lines Limited - India
- Vedanta Resources Plc - India
- Gujarat Sidhee Cement - India
- Meenaskhi Energy Private Limited - India
- Vizag Seaport Private Limited - India
- Bukit Baiduri Energy - Indonesia
- South Luzon Thermal Energy Corporation
- Merrill Lynch Commodities Europe
- Orica Australia Pty. Ltd.
- Carbofer General Trading SA - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Wood Mackenzie - Singapore
- SN Aboitiz Power Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Ministry of Finance - Indonesia
- London Commodity Brokers - England
- Maharashtra Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Rashtriya Ispat Nigam Limited - India
- Jaiprakash Power Ventures ltd
- Salva Resources Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Lanco Infratech Ltd - India
- Formosa Plastics Group - Taiwan
- Uttam Galva Steels Limited - India
- Oldendorff Carriers - Singapore
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