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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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Sunday, 18 November 18
COAL STOCKS IN A THIRD OF NTPC PLANTS CLOSE TO NIL - FINANCIAL EXPRESS
Coal supply shortage continues to haunt NTPC, the country’s largest power generator, with latest government data showing 31% of the company&r ...
Thursday, 15 November 18
OIL MARKET REPORT: HEEDING THE WARNINGS - IEA
In last month’s Report, we noted that since the middle of the year oil supply had increased sharply, with gains in the Middle East, Russia an ...
Wednesday, 14 November 18
BIMCO ADOPTS 2020 BUNKER CLAUSES
BIMCO has developed two 2020 bunker clauses that deal with general compliance and the transitional period for an early December release.
...
Wednesday, 14 November 18
SHIPPING MARKET INSIGHT - KONSTANTINOS KONTOMICHIS
The shipping industry is going through an interesting period across all markets. Since the end of last year, the Dry Baltic Index has been showing ...
Tuesday, 13 November 18
INDIA: POWER DEMAND UP; COAL STOCKS AT MINES AT A 5-YEAR LOW - FINANCIAL EXPRESS
Stocks at Coal India mines plunged to a five-year low of 21 million tonne (mt) in October, as a sudden surge in demand for the fuel from the power ...
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- Central Java Power - Indonesia
- Planning Commission, India
- Australian Commodity Traders Exchange
- OPG Power Generation Pvt Ltd - India
- Heidelberg Cement - Germany
- Pipit Mutiara Jaya. PT, Indonesia
- Salva Resources Pvt Ltd - India
- GMR Energy Limited - India
- Sojitz Corporation - Japan
- Bharathi Cement Corporation - India
- Power Finance Corporation Ltd., India
- Marubeni Corporation - India
- Directorate General of MIneral and Coal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Thai Mozambique Logistica
- Kartika Selabumi Mining - Indonesia
- Savvy Resources Ltd - HongKong
- Holcim Trading Pte Ltd - Singapore
- Pendopo Energi Batubara - Indonesia
- Vedanta Resources Plc - India
- Kobexindo Tractors - Indoneisa
- Iligan Light & Power Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Uttam Galva Steels Limited - India
- Goldman Sachs - Singapore
- Carbofer General Trading SA - India
- Indian Energy Exchange, India
- Attock Cement Pakistan Limited
- Indian Oil Corporation Limited
- Videocon Industries ltd - India
- Kapuas Tunggal Persada - Indonesia
- Sindya Power Generating Company Private Ltd
- Jindal Steel & Power Ltd - India
- Chettinad Cement Corporation Ltd - India
- Deloitte Consulting - India
- Sakthi Sugars Limited - India
- Bukit Makmur.PT - Indonesia
- Grasim Industreis Ltd - India
- Edison Trading Spa - Italy
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- GVK Power & Infra Limited - India
- SN Aboitiz Power Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Kumho Petrochemical, South Korea
- Bayan Resources Tbk. - Indonesia
- Parry Sugars Refinery, India
- Timah Investasi Mineral - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Anglo American - United Kingdom
- Vizag Seaport Private Limited - India
- Commonwealth Bank - Australia
- ICICI Bank Limited - India
- Semirara Mining and Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Intertek Mineral Services - Indonesia
- Riau Bara Harum - Indonesia
- Global Green Power PLC Corporation, Philippines
- Mercuria Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- Posco Energy - South Korea
- Bulk Trading Sa - Switzerland
- White Energy Company Limited
- PNOC Exploration Corporation - Philippines
- Africa Commodities Group - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Meenaskhi Energy Private Limited - India
- Lanco Infratech Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- VISA Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Renaissance Capital - South Africa
- India Bulls Power Limited - India
- Mintek Dendrill Indonesia
- Aboitiz Power Corporation - Philippines
- Merrill Lynch Commodities Europe
- Mercator Lines Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Karaikal Port Pvt Ltd - India
- Rio Tinto Coal - Australia
- Price Waterhouse Coopers - Russia
- International Coal Ventures Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Ceylon Electricity Board - Sri Lanka
- Alfred C Toepfer International GmbH - Germany
- Bhatia International Limited - India
- Tamil Nadu electricity Board
- Dalmia Cement Bharat India
- Romanian Commodities Exchange
- Singapore Mercantile Exchange
- Kaltim Prima Coal - Indonesia
- The University of Queensland
- Mjunction Services Limited - India
- Malabar Cements Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Standard Chartered Bank - UAE
- Makarim & Taira - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Siam City Cement - Thailand
- Agrawal Coal Company - India
- The State Trading Corporation of India Ltd
- Bangladesh Power Developement Board
- PTC India Limited - India
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
- Port Waratah Coal Services - Australia
- Bukit Baiduri Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Sarangani Energy Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Orica Mining Services - Indonesia
- Antam Resourcindo - Indonesia
- Interocean Group of Companies - India
- San Jose City I Power Corp, Philippines
- Coastal Gujarat Power Limited - India
- Eastern Coal Council - USA
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Electricity Authority - India
- Xindia Steels Limited - India
- Chamber of Mines of South Africa
- Georgia Ports Authority, United States
- The Treasury - Australian Government
- Meralco Power Generation, Philippines
- Global Coal Blending Company Limited - Australia
- Krishnapatnam Port Company Ltd. - India
- Gujarat Sidhee Cement - India
- Energy Development Corp, Philippines
- Parliament of New Zealand
- Binh Thuan Hamico - Vietnam
- MS Steel International - UAE
- Energy Link Ltd, New Zealand
- South Luzon Thermal Energy Corporation
- Latin American Coal - Colombia
- Gujarat Mineral Development Corp Ltd - India
- Altura Mining Limited, Indonesia
- London Commodity Brokers - England
- Australian Coal Association
- Independent Power Producers Association of India
- Petron Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- IEA Clean Coal Centre - UK
- Baramulti Group, Indonesia
- Metalloyd Limited - United Kingdom
- SMC Global Power, Philippines
- Semirara Mining Corp, Philippines
- Economic Council, Georgia
- Cigading International Bulk Terminal - Indonesia
- Straits Asia Resources Limited - Singapore
- Minerals Council of Australia
- McConnell Dowell - Australia
- Aditya Birla Group - India
- GN Power Mariveles Coal Plant, Philippines
- Sical Logistics Limited - India
- Siam City Cement PLC, Thailand
- IHS Mccloskey Coal Group - USA
- Jaiprakash Power Ventures ltd
- Barasentosa Lestari - Indonesia
- Madhucon Powers Ltd - India
- Kepco SPC Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Coal and Oil Company - UAE
- Larsen & Toubro Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Orica Australia Pty. Ltd.
- Oldendorff Carriers - Singapore
- Billiton Holdings Pty Ltd - Australia
- CNBM International Corporation - China
- Rashtriya Ispat Nigam Limited - India
- Wood Mackenzie - Singapore
- Bhoruka Overseas - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Banpu Public Company Limited - Thailand
- Manunggal Multi Energi - Indonesia
- Electricity Authority, New Zealand
- Medco Energi Mining Internasional
- Borneo Indobara - Indonesia
- New Zealand Coal & Carbon
- Indonesian Coal Mining Association
- Asmin Koalindo Tuhup - Indonesia
- Bhushan Steel Limited - India
- Indo Tambangraya Megah - Indonesia
- PowerSource Philippines DevCo
- European Bulk Services B.V. - Netherlands
- Trasteel International SA, Italy
- Samtan Co., Ltd - South Korea
- Miang Besar Coal Terminal - Indonesia
- Directorate Of Revenue Intelligence - India
- ASAPP Information Group - India
- AsiaOL BioFuels Corp., Philippines
- Maheswari Brothers Coal Limited - India
- Thiess Contractors Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Coalindo Energy - Indonesia
- Ministry of Finance - Indonesia
- LBH Netherlands Bv - Netherlands
- Electricity Generating Authority of Thailand
- Globalindo Alam Lestari - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- SMG Consultants - Indonesia
- Therma Luzon, Inc, Philippines
- Eastern Energy - Thailand
- Ministry of Transport, Egypt
- Tata Chemicals Ltd - India
- CIMB Investment Bank - Malaysia
- Formosa Plastics Group - Taiwan
- Ministry of Mines - Canada
- Kalimantan Lumbung Energi - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Wilmar Investment Holdings
- Star Paper Mills Limited - India
- Indika Energy - Indonesia
- Indogreen Group - Indonesia
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