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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, 30 November 18
GOVT MULLS REQUIRING MINERS TO TURN COAL INTO GAS - THE JAKARTA POST
The government is considering requiring all coal miners to turn the raw commodity into dimethylether (DME) as a substitute for liquefied petroleum ...
Friday, 30 November 18
SUPRAMAX: N. CHINA TO INDIA OR SE ASIA SUPRAS ARE GETTING PAID AROUND US$ 6000 - FEARNLEYS
Capesize
Sharp rise in spot activity and income, admittedly from very low levels, for the big ships. West Australia/China and Brazil/Far East b ...
Thursday, 29 November 18
NEW IMSBC CODE REQUIREMENTS AIM TO CONTROL LIQUEFACTION OF COAL CARGOES - GARD
KNOWLEDGE TO ELEVATE
The International Maritime Solid Bulk Cargoes (IMSBC) Code describes coal as a natural, solid, combustible material consi ...
Wednesday, 28 November 18
SHIPPING MARKET INSIGHT - GEORGE LAIOS
Last week I had the privilege to attend the SingularityU Greece Summit, in Athens. It was a privilege because you do not often have the chance to s ...
Tuesday, 27 November 18
PANAMAX AND SUPRAMAX INDICES WITNESSED A DECLINE OF JUST BELOW 14% IN THEIR MEAN ON A MONTH-ON-MONTH COMPARISON - ALLIED SHIPPING
A month of sharp corrections and great asymmetries for the dry bulk sector, with the overall overview of the market shipping rapidly from a state o ...
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- Essar Steel Hazira Ltd - India
- Standard Chartered Bank - UAE
- Toyota Tsusho Corporation, Japan
- Australian Coal Association
- Videocon Industries ltd - India
- TeaM Sual Corporation - Philippines
- Formosa Plastics Group - Taiwan
- Mjunction Services Limited - India
- Price Waterhouse Coopers - Russia
- Orica Mining Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bhatia International Limited - India
- Goldman Sachs - Singapore
- Kohat Cement Company Ltd. - Pakistan
- TNB Fuel Sdn Bhd - Malaysia
- Interocean Group of Companies - India
- Simpson Spence & Young - Indonesia
- Coal and Oil Company - UAE
- Miang Besar Coal Terminal - Indonesia
- Aditya Birla Group - India
- Bulk Trading Sa - Switzerland
- Sical Logistics Limited - India
- Directorate General of MIneral and Coal - Indonesia
- SMG Consultants - Indonesia
- Romanian Commodities Exchange
- Baramulti Group, Indonesia
- Edison Trading Spa - Italy
- London Commodity Brokers - England
- Ministry of Mines - Canada
- Antam Resourcindo - Indonesia
- Timah Investasi Mineral - Indoneisa
- Metalloyd Limited - United Kingdom
- Orica Australia Pty. Ltd.
- Karaikal Port Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Coastal Gujarat Power Limited - India
- Energy Link Ltd, New Zealand
- Indian Oil Corporation Limited
- Indian Energy Exchange, India
- Indo Tambangraya Megah - Indonesia
- Wood Mackenzie - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Parry Sugars Refinery, India
- Commonwealth Bank - Australia
- Energy Development Corp, Philippines
- India Bulls Power Limited - India
- Manunggal Multi Energi - Indonesia
- Binh Thuan Hamico - Vietnam
- Africa Commodities Group - South Africa
- Attock Cement Pakistan Limited
- Thiess Contractors Indonesia
- IEA Clean Coal Centre - UK
- White Energy Company Limited
- Semirara Mining and Power Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Port Waratah Coal Services - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Asmin Koalindo Tuhup - Indonesia
- Bhushan Steel Limited - India
- Parliament of New Zealand
- Sakthi Sugars Limited - India
- OPG Power Generation Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- Jindal Steel & Power Ltd - India
- Petron Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Mintek Dendrill Indonesia
- Kalimantan Lumbung Energi - Indonesia
- The State Trading Corporation of India Ltd
- Coalindo Energy - Indonesia
- Bharathi Cement Corporation - India
- Iligan Light & Power Inc, Philippines
- Sojitz Corporation - Japan
- Banpu Public Company Limited - Thailand
- Australian Commodity Traders Exchange
- PetroVietnam Power Coal Import and Supply Company
- SN Aboitiz Power Inc, Philippines
- Altura Mining Limited, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Chettinad Cement Corporation Ltd - India
- Kideco Jaya Agung - Indonesia
- Riau Bara Harum - Indonesia
- Star Paper Mills Limited - India
- MS Steel International - UAE
- Meenaskhi Energy Private Limited - India
- IHS Mccloskey Coal Group - USA
- CIMB Investment Bank - Malaysia
- Kobexindo Tractors - Indoneisa
- Samtan Co., Ltd - South Korea
- Intertek Mineral Services - Indonesia
- San Jose City I Power Corp, Philippines
- Mercator Lines Limited - India
- Medco Energi Mining Internasional
- Eastern Energy - Thailand
- Chamber of Mines of South Africa
- Thai Mozambique Logistica
- Anglo American - United Kingdom
- ASAPP Information Group - India
- Deloitte Consulting - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Borneo Indobara - Indonesia
- Semirara Mining Corp, Philippines
- Merrill Lynch Commodities Europe
- New Zealand Coal & Carbon
- Jaiprakash Power Ventures ltd
- Sarangani Energy Corporation, Philippines
- Central Java Power - Indonesia
- Siam City Cement - Thailand
- Ambuja Cements Ltd - India
- Bhoruka Overseas - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Rashtriya Ispat Nigam Limited - India
- Straits Asia Resources Limited - Singapore
- Latin American Coal - Colombia
- Larsen & Toubro Limited - India
- PowerSource Philippines DevCo
- Planning Commission, India
- Salva Resources Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Renaissance Capital - South Africa
- Ministry of Transport, Egypt
- Sree Jayajothi Cements Limited - India
- Kartika Selabumi Mining - Indonesia
- Kaltim Prima Coal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Vizag Seaport Private Limited - India
- Madhucon Powers Ltd - India
- Eastern Coal Council - USA
- The University of Queensland
- Economic Council, Georgia
- Global Business Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Wilmar Investment Holdings
- Agrawal Coal Company - India
- Lanco Infratech Ltd - India
- Pendopo Energi Batubara - Indonesia
- Bangladesh Power Developement Board
- Georgia Ports Authority, United States
- Holcim Trading Pte Ltd - Singapore
- Trasteel International SA, Italy
- GVK Power & Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Posco Energy - South Korea
- Power Finance Corporation Ltd., India
- Sindya Power Generating Company Private Ltd
- Ind-Barath Power Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- PTC India Limited - India
- European Bulk Services B.V. - Netherlands
- Electricity Generating Authority of Thailand
- Oldendorff Carriers - Singapore
- Cement Manufacturers Association - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- LBH Netherlands Bv - Netherlands
- Electricity Authority, New Zealand
- Aboitiz Power Corporation - Philippines
- ICICI Bank Limited - India
- Bukit Makmur.PT - Indonesia
- Mercuria Energy - Indonesia
- CNBM International Corporation - China
- Indogreen Group - Indonesia
- Ministry of Finance - Indonesia
- Malabar Cements Ltd - India
- Carbofer General Trading SA - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Xindia Steels Limited - India
- Gujarat Electricity Regulatory Commission - India
- Indika Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Vedanta Resources Plc - India
- Gujarat Mineral Development Corp Ltd - India
- Siam City Cement PLC, Thailand
- Directorate Of Revenue Intelligence - India
- McConnell Dowell - Australia
- Savvy Resources Ltd - HongKong
- Karbindo Abesyapradhi - Indoneisa
- Therma Luzon, Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- Kepco SPC Power Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Cigading International Bulk Terminal - Indonesia
- Marubeni Corporation - India
- Minerals Council of Australia
- Central Electricity Authority - India
- The Treasury - Australian Government
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meralco Power Generation, Philippines
- SMC Global Power, Philippines
- Barasentosa Lestari - Indonesia
- Heidelberg Cement - Germany
- Tamil Nadu electricity Board
- Dalmia Cement Bharat India
- Makarim & Taira - Indonesia
- Uttam Galva Steels Limited - India
- Bukit Baiduri Energy - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Singapore Mercantile Exchange
- GMR Energy Limited - India
- VISA Power Limited - India
- Globalindo Alam Lestari - Indonesia
- Independent Power Producers Association of India
- Kapuas Tunggal Persada - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Ceylon Electricity Board - Sri Lanka
- Pipit Mutiara Jaya. PT, Indonesia
- Kumho Petrochemical, South Korea
- PNOC Exploration Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Indonesian Coal Mining Association
- Grasim Industreis Ltd - India
- Rio Tinto Coal - Australia
- Vijayanagar Sugar Pvt Ltd - India
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