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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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Monday, 29 October 18
SUPRAMAX: THE ASIAN AREA SAW FALLING RATES, WITH A 61,000DWT FIXING DELIVERY KOHSICHANG TRIP VIA INDONESIA, REDELIVERY INDIA, AT $10,500 - BALTIC BRIEFING
Capesize
A market of two halves for most of the week with rates in the Atlantic firming and easing in the East for most of the week, but then, ...
Friday, 26 October 18
SHIP OPERATING COSTS EXPECTED TO RISE IN 2018 AND 2019 - MOORE STEPHENS
Total vessel operating costs in the shipping industry are expected to rise by 2.7% in 2018 and by 3.1% in 2019, according to our latest survey.
...
Friday, 26 October 18
SEVERAL CONTRACTIONS IN GLOBAL STEEL PRODUCTION - JEFFREY LANDSBERG
World Steel Association data released today shows that global crude steel production totaled approximately 151.7 million tons in September. T ...
Thursday, 25 October 18
WHAT DOES THE "IMO 2020" REGULATION REALLY SAY? A QUICK GUIDE - BIMCO
KNOWLEDGE TO ELEVATE
The shipping industry has all eyes firmly fixed on the topic, but what exactly do the “IMO 2020” global sulph ...
Wednesday, 24 October 18
MARKET INSIGHT - NASSOS SOULAKIS
Looking at 2018 SnP activity, it is evident that Greek, Chinese and North European (German and Norwegian) owners are the top buying nationalities, ...
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- Bulk Trading Sa - Switzerland
- Kohat Cement Company Ltd. - Pakistan
- Bahari Cakrawala Sebuku - Indonesia
- GAC Shipping (India) Pvt Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Orica Australia Pty. Ltd.
- Intertek Mineral Services - Indonesia
- Georgia Ports Authority, United States
- Sree Jayajothi Cements Limited - India
- Parry Sugars Refinery, India
- Indika Energy - Indonesia
- Siam City Cement - Thailand
- Krishnapatnam Port Company Ltd. - India
- Romanian Commodities Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- AsiaOL BioFuels Corp., Philippines
- Aditya Birla Group - India
- PTC India Limited - India
- Jindal Steel & Power Ltd - India
- Iligan Light & Power Inc, Philippines
- Electricity Generating Authority of Thailand
- Cigading International Bulk Terminal - Indonesia
- Ministry of Finance - Indonesia
- PNOC Exploration Corporation - Philippines
- Ambuja Cements Ltd - India
- Borneo Indobara - Indonesia
- Cement Manufacturers Association - India
- The University of Queensland
- Formosa Plastics Group - Taiwan
- Savvy Resources Ltd - HongKong
- McConnell Dowell - Australia
- PowerSource Philippines DevCo
- Holcim Trading Pte Ltd - Singapore
- Australian Commodity Traders Exchange
- SMG Consultants - Indonesia
- India Bulls Power Limited - India
- European Bulk Services B.V. - Netherlands
- Port Waratah Coal Services - Australia
- Kepco SPC Power Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Wood Mackenzie - Singapore
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining and Power Corporation, Philippines
- Edison Trading Spa - Italy
- Samtan Co., Ltd - South Korea
- Baramulti Group, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Timah Investasi Mineral - Indoneisa
- Sical Logistics Limited - India
- Ceylon Electricity Board - Sri Lanka
- Global Coal Blending Company Limited - Australia
- White Energy Company Limited
- Karaikal Port Pvt Ltd - India
- Indian Energy Exchange, India
- Directorate Of Revenue Intelligence - India
- Eastern Energy - Thailand
- LBH Netherlands Bv - Netherlands
- Carbofer General Trading SA - India
- Maheswari Brothers Coal Limited - India
- Bhushan Steel Limited - India
- Makarim & Taira - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GMR Energy Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Africa Commodities Group - South Africa
- Rashtriya Ispat Nigam Limited - India
- Altura Mining Limited, Indonesia
- Sindya Power Generating Company Private Ltd
- Kumho Petrochemical, South Korea
- Essar Steel Hazira Ltd - India
- Vedanta Resources Plc - India
- Chettinad Cement Corporation Ltd - India
- ICICI Bank Limited - India
- Eastern Coal Council - USA
- Central Java Power - Indonesia
- CIMB Investment Bank - Malaysia
- Salva Resources Pvt Ltd - India
- Ministry of Mines - Canada
- Global Business Power Corporation, Philippines
- Thiess Contractors Indonesia
- Bangladesh Power Developement Board
- PetroVietnam Power Coal Import and Supply Company
- Agrawal Coal Company - India
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- SMC Global Power, Philippines
- Coalindo Energy - Indonesia
- Semirara Mining Corp, Philippines
- Binh Thuan Hamico - Vietnam
- SN Aboitiz Power Inc, Philippines
- Indian Oil Corporation Limited
- Coastal Gujarat Power Limited - India
- Jaiprakash Power Ventures ltd
- Kideco Jaya Agung - Indonesia
- GVK Power & Infra Limited - India
- The Treasury - Australian Government
- Indo Tambangraya Megah - Indonesia
- Oldendorff Carriers - Singapore
- Directorate General of MIneral and Coal - Indonesia
- Marubeni Corporation - India
- Latin American Coal - Colombia
- Independent Power Producers Association of India
- OPG Power Generation Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Tamil Nadu electricity Board
- International Coal Ventures Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Dalmia Cement Bharat India
- Leighton Contractors Pty Ltd - Australia
- MS Steel International - UAE
- Attock Cement Pakistan Limited
- South Luzon Thermal Energy Corporation
- Jorong Barutama Greston.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bharathi Cement Corporation - India
- Gujarat Mineral Development Corp Ltd - India
- San Jose City I Power Corp, Philippines
- Medco Energi Mining Internasional
- Bukit Baiduri Energy - Indonesia
- Malabar Cements Ltd - India
- Xindia Steels Limited - India
- Orica Mining Services - Indonesia
- Rio Tinto Coal - Australia
- Standard Chartered Bank - UAE
- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Banpu Public Company Limited - Thailand
- Renaissance Capital - South Africa
- Bukit Makmur.PT - Indonesia
- Star Paper Mills Limited - India
- Meralco Power Generation, Philippines
- Vizag Seaport Private Limited - India
- Electricity Authority, New Zealand
- Bhoruka Overseas - Indonesia
- Sakthi Sugars Limited - India
- Metalloyd Limited - United Kingdom
- Merrill Lynch Commodities Europe
- Madhucon Powers Ltd - India
- Bhatia International Limited - India
- Meenaskhi Energy Private Limited - India
- Grasim Industreis Ltd - India
- Indonesian Coal Mining Association
- Thai Mozambique Logistica
- Globalindo Alam Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Billiton Holdings Pty Ltd - Australia
- Central Electricity Authority - India
- Energy Development Corp, Philippines
- Parliament of New Zealand
- IEA Clean Coal Centre - UK
- Economic Council, Georgia
- Toyota Tsusho Corporation, Japan
- Maharashtra Electricity Regulatory Commission - India
- TeaM Sual Corporation - Philippines
- Antam Resourcindo - Indonesia
- Anglo American - United Kingdom
- Mercator Lines Limited - India
- Minerals Council of Australia
- Commonwealth Bank - Australia
- Lanco Infratech Ltd - India
- Power Finance Corporation Ltd., India
- New Zealand Coal & Carbon
- Ind-Barath Power Infra Limited - India
- Alfred C Toepfer International GmbH - Germany
- Gujarat Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Siam City Cement PLC, Thailand
- Singapore Mercantile Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sojitz Corporation - Japan
- Posco Energy - South Korea
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Sidhee Cement - India
- VISA Power Limited - India
- Planning Commission, India
- Interocean Group of Companies - India
- Uttam Galva Steels Limited - India
- Trasteel International SA, Italy
- TNB Fuel Sdn Bhd - Malaysia
- Asmin Koalindo Tuhup - Indonesia
- Wilmar Investment Holdings
- Energy Link Ltd, New Zealand
- CNBM International Corporation - China
- Tata Chemicals Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Riau Bara Harum - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Bayan Resources Tbk. - Indonesia
- IHS Mccloskey Coal Group - USA
- Larsen & Toubro Limited - India
- Chamber of Mines of South Africa
- Indogreen Group - Indonesia
- The State Trading Corporation of India Ltd
- London Commodity Brokers - England
- Vijayanagar Sugar Pvt Ltd - India
- Petron Corporation, Philippines
- ASAPP Information Group - India
- Pendopo Energi Batubara - Indonesia
- Kaltim Prima Coal - Indonesia
- Kobexindo Tractors - Indoneisa
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- Deloitte Consulting - India
- Simpson Spence & Young - Indonesia
- Goldman Sachs - Singapore
- Manunggal Multi Energi - Indonesia
- Heidelberg Cement - Germany
- Mjunction Services Limited - India
- Mercuria Energy - Indonesia
- Mintek Dendrill Indonesia
- Ministry of Transport, Egypt
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