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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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Friday, 14 December 18
KOSPO INVITES BIDS FOR 1,177,000 METRIC TONS OF COAL FOR Q1' 19 LOADING
COALspot.com: South Korea state-owned utility Korea Southern Power Co. Ltd (KOSPO) issued a tender for 701,000 MT of min 5,600 kcal/kg NCV coal and ...
Friday, 14 December 18
COAL IMPORT TO BE CHECKED BY RISING DOMESTIC PRODUCTION - FINANCIAL EXPRESS
The government’s effort to increase domestic coal production and power demand falling with the onset of the winters will check coal imports, ...
Thursday, 13 December 18
STRAITS AFFECTED BY TERRITORIAL DISPUTE BETWEEN SINGAPORE AND MALAYSIA - THE STANDARD CLUB
A recent territorial dispute has occurred between Singapore and Malaysia involving the Straits of Johor.
The Malaysian Attorney Gene ...
Wednesday, 12 December 18
SHIPPING MARKET INSIGHT - CHRISTOPHER WHITTY
China’s monthly iron ore imports dropped for the first time this year joined by declines in copper and soybeans as economic growth slows in t ...
Tuesday, 11 December 18
SHIPPING MARKET ANALYSIS - ALLIED
A lot of discussions have been made as to the effects of the IMO 2020 regulation on OPEX levels, investment feasibility of& ...
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- Romanian Commodities Exchange
- Makarim & Taira - Indonesia
- Star Paper Mills Limited - India
- Chettinad Cement Corporation Ltd - India
- GAC Shipping (India) Pvt Ltd
- ICICI Bank Limited - India
- Thai Mozambique Logistica
- Billiton Holdings Pty Ltd - Australia
- Marubeni Corporation - India
- Videocon Industries ltd - India
- Carbofer General Trading SA - India
- GVK Power & Infra Limited - India
- Wilmar Investment Holdings
- Sakthi Sugars Limited - India
- Tata Chemicals Ltd - India
- Orica Australia Pty. Ltd.
- Australian Coal Association
- Baramulti Group, Indonesia
- Ambuja Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- White Energy Company Limited
- Alfred C Toepfer International GmbH - Germany
- Indo Tambangraya Megah - Indonesia
- Aditya Birla Group - India
- Kaltim Prima Coal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- LBH Netherlands Bv - Netherlands
- Lanco Infratech Ltd - India
- Planning Commission, India
- Kideco Jaya Agung - Indonesia
- Singapore Mercantile Exchange
- OPG Power Generation Pvt Ltd - India
- India Bulls Power Limited - India
- Kartika Selabumi Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Ministry of Mines - Canada
- Jindal Steel & Power Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- London Commodity Brokers - England
- Global Business Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Vedanta Resources Plc - India
- Globalindo Alam Lestari - Indonesia
- Port Waratah Coal Services - Australia
- Africa Commodities Group - South Africa
- MS Steel International - UAE
- Chamber of Mines of South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Therma Luzon, Inc, Philippines
- Commonwealth Bank - Australia
- The University of Queensland
- Kobexindo Tractors - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Maheswari Brothers Coal Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Minerals Council of Australia
- Salva Resources Pvt Ltd - India
- Mercator Lines Limited - India
- Metalloyd Limited - United Kingdom
- Samtan Co., Ltd - South Korea
- Semirara Mining Corp, Philippines
- Larsen & Toubro Limited - India
- European Bulk Services B.V. - Netherlands
- Malabar Cements Ltd - India
- Economic Council, Georgia
- Energy Link Ltd, New Zealand
- AsiaOL BioFuels Corp., Philippines
- Medco Energi Mining Internasional
- Kumho Petrochemical, South Korea
- Meralco Power Generation, Philippines
- Simpson Spence & Young - Indonesia
- Essar Steel Hazira Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Merrill Lynch Commodities Europe
- Banpu Public Company Limited - Thailand
- Petron Corporation, Philippines
- SMG Consultants - Indonesia
- Ministry of Transport, Egypt
- Posco Energy - South Korea
- Manunggal Multi Energi - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Aboitiz Power Corporation - Philippines
- Latin American Coal - Colombia
- PTC India Limited - India
- South Luzon Thermal Energy Corporation
- Parry Sugars Refinery, India
- SN Aboitiz Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- Miang Besar Coal Terminal - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Coalindo Energy - Indonesia
- Mjunction Services Limited - India
- Intertek Mineral Services - Indonesia
- Sical Logistics Limited - India
- Altura Mining Limited, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Mercuria Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- IHS Mccloskey Coal Group - USA
- Straits Asia Resources Limited - Singapore
- Krishnapatnam Port Company Ltd. - India
- San Jose City I Power Corp, Philippines
- Central Electricity Authority - India
- Bhoruka Overseas - Indonesia
- Savvy Resources Ltd - HongKong
- Karaikal Port Pvt Ltd - India
- Bhatia International Limited - India
- Xindia Steels Limited - India
- Parliament of New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Borneo Indobara - Indonesia
- The Treasury - Australian Government
- Neyveli Lignite Corporation Ltd, - India
- GN Power Mariveles Coal Plant, Philippines
- International Coal Ventures Pvt Ltd - India
- Eastern Energy - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Kalimantan Lumbung Energi - Indonesia
- Thiess Contractors Indonesia
- IEA Clean Coal Centre - UK
- Grasim Industreis Ltd - India
- PNOC Exploration Corporation - Philippines
- Formosa Plastics Group - Taiwan
- Global Coal Blending Company Limited - Australia
- Oldendorff Carriers - Singapore
- Bayan Resources Tbk. - Indonesia
- Dalmia Cement Bharat India
- Orica Mining Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Bukit Baiduri Energy - Indonesia
- Renaissance Capital - South Africa
- Antam Resourcindo - Indonesia
- Siam City Cement - Thailand
- VISA Power Limited - India
- Goldman Sachs - Singapore
- Jaiprakash Power Ventures ltd
- Georgia Ports Authority, United States
- GMR Energy Limited - India
- Heidelberg Cement - Germany
- McConnell Dowell - Australia
- Global Green Power PLC Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- Directorate General of MIneral and Coal - Indonesia
- Binh Thuan Hamico - Vietnam
- Sree Jayajothi Cements Limited - India
- Energy Development Corp, Philippines
- Rashtriya Ispat Nigam Limited - India
- Australian Commodity Traders Exchange
- PowerSource Philippines DevCo
- Indian Oil Corporation Limited
- Pendopo Energi Batubara - Indonesia
- Electricity Authority, New Zealand
- ASAPP Information Group - India
- Coastal Gujarat Power Limited - India
- Attock Cement Pakistan Limited
- Indian Energy Exchange, India
- Ind-Barath Power Infra Limited - India
- Coal and Oil Company - UAE
- Indika Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Sinarmas Energy and Mining - Indonesia
- Ministry of Finance - Indonesia
- Indonesian Coal Mining Association
- Riau Bara Harum - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Power Finance Corporation Ltd., India
- Agrawal Coal Company - India
- Timah Investasi Mineral - Indoneisa
- TeaM Sual Corporation - Philippines
- Siam City Cement PLC, Thailand
- Kohat Cement Company Ltd. - Pakistan
- Sojitz Corporation - Japan
- Wood Mackenzie - Singapore
- Anglo American - United Kingdom
- Iligan Light & Power Inc, Philippines
- Mintek Dendrill Indonesia
- CNBM International Corporation - China
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bukit Makmur.PT - Indonesia
- Tamil Nadu electricity Board
- Semirara Mining and Power Corporation, Philippines
- Trasteel International SA, Italy
- New Zealand Coal & Carbon
- Maharashtra Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- Rio Tinto Coal - Australia
- Indogreen Group - Indonesia
- Edison Trading Spa - Italy
- Electricity Generating Authority of Thailand
- Standard Chartered Bank - UAE
- Interocean Group of Companies - India
- Bhushan Steel Limited - India
- Sindya Power Generating Company Private Ltd
- Eastern Coal Council - USA
- Vizag Seaport Private Limited - India
- Deloitte Consulting - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Madhucon Powers Ltd - India
- Cement Manufacturers Association - India
- Barasentosa Lestari - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Central Java Power - Indonesia
- Meenaskhi Energy Private Limited - India
- Toyota Tsusho Corporation, Japan
- Kapuas Tunggal Persada - Indonesia
- The State Trading Corporation of India Ltd
- Bulk Trading Sa - Switzerland
- Kepco SPC Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Uttam Galva Steels Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bharathi Cement Corporation - India
- Gujarat Sidhee Cement - India
- CIMB Investment Bank - Malaysia
- Bangladesh Power Developement Board
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