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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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Wednesday, 06 February 19
THE BDI HAS EASED BACK TO 645 BP, ITS LOWEST LEVEL SINCE AUGUST 2016 - ALLIED
The dry bulk sector is in the doldrums, with most market participants seemingly left utterly perplexed, and simultaneously, in pursuit of any posit ...
Monday, 04 February 19
COAL STILL IN HIGH DEMAND GLOBALLY
Although the world is switching to renewable energy there is still a big demand for coal around the globe.
This is according to Cany ...
Friday, 01 February 19
ULTRAMAX WAS FIXED DELIVERY KALIMANTAN, FOR TRIP TO WEST COAST INDIA AT $7,000 - BALTIC BRIEFING
Capesize
The Vale dam tragedy sparked a sharp fall in rates across all regions even where tonnage remained tight. The potential loss of product ...
Friday, 01 February 19
SEMBCORP SELECTS NORDEN FOR LONG-TERM INDIAN CONTRACT
NORDEN A/S has signed a 10-year Panamax Contract of Affreightment (COA) with Indian utility firm Sembcorp Energy India Ltd.
From 1 A ...
Tuesday, 29 January 19
HARD COAL BEARS THE BRUNT OF THE RECOMMENDATIONS OF THE COMMISSION GROWTH STRUCTURAL CHANGE AND EMPLOYMENT - VDKI
Press Release: Hard coal bears the brunt of the recommendations of the Commission Growth Structural change and employment.
In its fi ...
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- Kideco Jaya Agung - Indonesia
- Thai Mozambique Logistica
- Simpson Spence & Young - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Uttam Galva Steels Limited - India
- Carbofer General Trading SA - India
- The State Trading Corporation of India Ltd
- Merrill Lynch Commodities Europe
- MS Steel International - UAE
- Ministry of Finance - Indonesia
- GVK Power & Infra Limited - India
- Vedanta Resources Plc - India
- Bahari Cakrawala Sebuku - Indonesia
- Banpu Public Company Limited - Thailand
- Siam City Cement - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Energy Link Ltd, New Zealand
- Central Electricity Authority - India
- Iligan Light & Power Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Orica Australia Pty. Ltd.
- Eastern Energy - Thailand
- Posco Energy - South Korea
- Coalindo Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- London Commodity Brokers - England
- Indika Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Coal and Oil Company - UAE
- Videocon Industries ltd - India
- Therma Luzon, Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Binh Thuan Hamico - Vietnam
- European Bulk Services B.V. - Netherlands
- PTC India Limited - India
- Indo Tambangraya Megah - Indonesia
- Orica Mining Services - Indonesia
- Australian Coal Association
- Medco Energi Mining Internasional
- Bhatia International Limited - India
- Salva Resources Pvt Ltd - India
- Mercator Lines Limited - India
- Holcim Trading Pte Ltd - Singapore
- Metalloyd Limited - United Kingdom
- Sical Logistics Limited - India
- Petron Corporation, Philippines
- Latin American Coal - Colombia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sarangani Energy Corporation, Philippines
- Electricity Generating Authority of Thailand
- Kalimantan Lumbung Energi - Indonesia
- Wood Mackenzie - Singapore
- India Bulls Power Limited - India
- Antam Resourcindo - Indonesia
- Sree Jayajothi Cements Limited - India
- Sindya Power Generating Company Private Ltd
- Maheswari Brothers Coal Limited - India
- Savvy Resources Ltd - HongKong
- Global Coal Blending Company Limited - Australia
- Maharashtra Electricity Regulatory Commission - India
- ICICI Bank Limited - India
- Krishnapatnam Port Company Ltd. - India
- Globalindo Alam Lestari - Indonesia
- South Luzon Thermal Energy Corporation
- Riau Bara Harum - Indonesia
- Intertek Mineral Services - Indonesia
- Jindal Steel & Power Ltd - India
- Renaissance Capital - South Africa
- Directorate General of MIneral and Coal - Indonesia
- Chamber of Mines of South Africa
- Kartika Selabumi Mining - Indonesia
- IEA Clean Coal Centre - UK
- Kaltim Prima Coal - Indonesia
- SMG Consultants - Indonesia
- Global Business Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Vijayanagar Sugar Pvt Ltd - India
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Ceylon Electricity Board - Sri Lanka
- Alfred C Toepfer International GmbH - Germany
- Marubeni Corporation - India
- Bukit Baiduri Energy - Indonesia
- Kumho Petrochemical, South Korea
- Essar Steel Hazira Ltd - India
- Trasteel International SA, Italy
- Anglo American - United Kingdom
- Parliament of New Zealand
- Bayan Resources Tbk. - Indonesia
- Economic Council, Georgia
- TeaM Sual Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Sakthi Sugars Limited - India
- New Zealand Coal & Carbon
- AsiaOL BioFuels Corp., Philippines
- Energy Development Corp, Philippines
- Aboitiz Power Corporation - Philippines
- Makarim & Taira - Indonesia
- Romanian Commodities Exchange
- Gujarat Electricity Regulatory Commission - India
- Bangladesh Power Developement Board
- PowerSource Philippines DevCo
- Sinarmas Energy and Mining - Indonesia
- Pendopo Energi Batubara - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Ministry of Mines - Canada
- The University of Queensland
- Africa Commodities Group - South Africa
- Vizag Seaport Private Limited - India
- San Jose City I Power Corp, Philippines
- Mercuria Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- Formosa Plastics Group - Taiwan
- Dalmia Cement Bharat India
- TNB Fuel Sdn Bhd - Malaysia
- Malabar Cements Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- VISA Power Limited - India
- Samtan Co., Ltd - South Korea
- Pipit Mutiara Jaya. PT, Indonesia
- Indogreen Group - Indonesia
- Planning Commission, India
- Toyota Tsusho Corporation, Japan
- Lanco Infratech Ltd - India
- Electricity Authority, New Zealand
- Tamil Nadu electricity Board
- CIMB Investment Bank - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Standard Chartered Bank - UAE
- Rio Tinto Coal - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Jorong Barutama Greston.PT - Indonesia
- Straits Asia Resources Limited - Singapore
- Kobexindo Tractors - Indoneisa
- CNBM International Corporation - China
- Georgia Ports Authority, United States
- Attock Cement Pakistan Limited
- PetroVietnam Power Coal Import and Supply Company
- Minerals Council of Australia
- Singapore Mercantile Exchange
- Tata Chemicals Ltd - India
- Indian Energy Exchange, India
- Karbindo Abesyapradhi - Indoneisa
- Meralco Power Generation, Philippines
- Agrawal Coal Company - India
- Karaikal Port Pvt Ltd - India
- Edison Trading Spa - Italy
- Semirara Mining Corp, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Sojitz Corporation - Japan
- Goldman Sachs - Singapore
- Billiton Holdings Pty Ltd - Australia
- Indian Oil Corporation Limited
- LBH Netherlands Bv - Netherlands
- Thiess Contractors Indonesia
- Timah Investasi Mineral - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Parry Sugars Refinery, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wilmar Investment Holdings
- Cigading International Bulk Terminal - Indonesia
- OPG Power Generation Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Interocean Group of Companies - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Independent Power Producers Association of India
- Coastal Gujarat Power Limited - India
- Indonesian Coal Mining Association
- GMR Energy Limited - India
- Bulk Trading Sa - Switzerland
- GAC Shipping (India) Pvt Ltd
- White Energy Company Limited
- Mjunction Services Limited - India
- IHS Mccloskey Coal Group - USA
- Port Waratah Coal Services - Australia
- Cement Manufacturers Association - India
- Star Paper Mills Limited - India
- McConnell Dowell - Australia
- Eastern Coal Council - USA
- Siam City Cement PLC, Thailand
- Larsen & Toubro Limited - India
- Jaiprakash Power Ventures ltd
- Mintek Dendrill Indonesia
- Bukit Makmur.PT - Indonesia
- Xindia Steels Limited - India
- Power Finance Corporation Ltd., India
- SMC Global Power, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Deloitte Consulting - India
- Borneo Indobara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Transport, Egypt
- Commonwealth Bank - Australia
- Kapuas Tunggal Persada - Indonesia
- Bharathi Cement Corporation - India
- Baramulti Group, Indonesia
- Central Java Power - Indonesia
- Ambuja Cements Ltd - India
- Kepco SPC Power Corporation, Philippines
- Heidelberg Cement - Germany
- Madhucon Powers Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Oldendorff Carriers - Singapore
- Aditya Birla Group - India
- Bhushan Steel Limited - India
- Altura Mining Limited, Indonesia
- The Treasury - Australian Government
- Ind-Barath Power Infra Limited - India
- Grasim Industreis Ltd - India
- Manunggal Multi Energi - Indonesia
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