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Saturday, 21 December 19
SHIPPING'S SUPPLY AND DEMAND TRENDING OFF BALANCE - BIMCO
 One of the most worrying trends that has developed recently – which will affect shipping demand in the years to come – is the falling trade-to-GDP ratio.
The falling ratio can be explained by slowing globalistation as well as increasing protectionist measures being implemented around the world, spear headed by the US. The raised barriers to trade are here to stay as we enter a new decade, with the shipping industry stuck with the consequences.
The trade war is the clearest example of these extra barriers to trade, and although a phase 1 deal was reached in December, the most difficult issues have yet to be addressed, and BIMCO therefore expects the trade war to continue to plague shipping between the US and China in 2020. Unfortunately, they are not the only countries engaging in tariff wars. The EU also faces additional tariffs from the US and we see trade tensions between Japan and South Korea.
The effects of the worsening of the fundamental shipping market balances this year will be felt in 2020, as the balance is not reset to zero when the calendar year changes. BIMCO continues to warn that the worsening balance between the supply of ships and the demand will be detrimental to shipowners’ ability to pass on the additional costs associated with compliance of the new IMO 2020 Sulphur Cap. It will depend on the freight rates to which extent the additional costs are covered, which in turn depend on the market conditions; the better the market, the easier it is to pass costs on.
Dry Bulk shipping
The biggest concern for Capesize shipping in 2020 is the trend in China, where iron ore imports may fall for the third year in a row. The structural change in China’s steel production, towards using scrap steel in favour of imported iron ore, means that Chinese demand for iron ore can no longer be counted on to increase demand for Capesize ships, with imports having peaked in 2017.
For the dry bulk shipping industry there is more bad news from China. Its soya bean imports have become an important part of the trade war and how it is viewed, but even aside from the trade war, the outlook for soya bean trades into China are weak. Its demand will be considerably lower due to the largest ever culling of pigs which consume most of China’s soya bean imports. It will take years for the Chinese pig population to return to the same size as before the cull, and even then, lowering the soya content in pig’s feed will have lasting consequences on these trades.
The high fleet growth in 2019 (4.1%) will play out into 2020 when the fleet is also expected to grow by more than demand. The cumulative impact of these growth rates mean that the gap between demand for shipping and the supply of ships will continue to grow, putting pressure on freight rates throughout the year.
Tanker Shipping
Crude oil tankers have certainly been in the headlines in 2019 due to geopolitical developments and as freight rates reached record levels as a result, but going into 2020, the fundamentals remain unchanged. This means that after the seasonal boost fades away in the first quarter, the high freight rates in the VLCC-market are likely to disappear, as the market fundamentals have in fact worsened in 2019, with an eight year high fleet growth of 6.3%.
Fleet growth has also been high in the oil product tanker market, with many owners aiming to benefit from the IMO 2020 Sulphur Cap and the boost that BIMCO expects it will bring to the oil product tanker shipping industry. The boost are on the back of the new trades for the transport of compliant bunker fuels from the refineries to the bunkering ports.
While this boost will improve tanker earnings in the first 3-6 months of 2020, once the short term boost will fade away, the challenge facing the market is that the new ships will still be around , and will instead be fighting for cargoes in an already over-supplied market.
One of the major developments expected in 2020 is for the US to become a net exporter of crude oil on an annual basis. The increasing proportion of global crude oil exports coming from the US is good news for the tanker industry as this involves longer sailing distances to the Far East, where the major importers are, compared to exports from the Middle East.
Source: Peter Sand, Chief Shipping Analyst, BIMCO
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Saturday, 30 November 19
PANAMAX: LEVELS IMPROVED IN THE PACIFIC MARKET TOO WITH $11,000 BEING CONCLUDED ON AN 81,000DWT SHIP FOR AN INDONESIA TO CHINA COAL TRIP - BALTIC BRIEFING
Capesize
The market has been well supported over the past week, led primarily by the Atlantic Basin. After bottoming last week, sentiment was s ...
Friday, 29 November 19
FITCHRATINGS MAINTAINS NEGATIVE 2020 OUTLOOK ON SHIPPING, AS TIGHTER SUPPLY HELPS, BUT SOFTER DEMAND DRAGS
Fitch’s Sector Outlook: Negative
We maintain a negative sector outlook for global shipping because of the forecast slowdown of ...
Friday, 29 November 19
INDONESIA PRODUCES 390 MLN TONNES OF COAL IN JAN-SEPT: MINISTER - REUTERS
Indonesia’s production of coal for the January-September period was 390 million tonnes, Energy and Mineral Resources Minister Arifin Tasrif s ...
Wednesday, 27 November 19
SHIPPING MARKET INSIGHT - INTERMODAL
As the end of the fourth quarter is approaching, one could say that the wet market has maintained the strong pace observed during the third qu ...
Tuesday, 26 November 19
PREPARATIONS INTENSIFY AS 1 JANUARY 2020 GLOBAL CUT IN SULPHUR IN SHIP'S FUEL OIL LOOMS: IMO
“IMO 2020” requirements for ships to cut sulphur oxide emissions enter into effect in just over one month’s time. This will signi ...
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- Ministry of Finance - Indonesia
- Xindia Steels Limited - India
- Coalindo Energy - Indonesia
- Indian Oil Corporation Limited
- Karbindo Abesyapradhi - Indoneisa
- PowerSource Philippines DevCo
- VISA Power Limited - India
- Metalloyd Limited - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- Meenaskhi Energy Private Limited - India
- Carbofer General Trading SA - India
- Kohat Cement Company Ltd. - Pakistan
- Thai Mozambique Logistica
- Ind-Barath Power Infra Limited - India
- Sinarmas Energy and Mining - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Semirara Mining and Power Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Bhoruka Overseas - Indonesia
- OPG Power Generation Pvt Ltd - India
- Australian Commodity Traders Exchange
- Uttam Galva Steels Limited - India
- International Coal Ventures Pvt Ltd - India
- Marubeni Corporation - India
- Sakthi Sugars Limited - India
- Lanco Infratech Ltd - India
- Indo Tambangraya Megah - Indonesia
- South Luzon Thermal Energy Corporation
- Attock Cement Pakistan Limited
- European Bulk Services B.V. - Netherlands
- Bukit Makmur.PT - Indonesia
- ICICI Bank Limited - India
- IEA Clean Coal Centre - UK
- Sindya Power Generating Company Private Ltd
- Thiess Contractors Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Energy Link Ltd, New Zealand
- Sarangani Energy Corporation, Philippines
- Parliament of New Zealand
- Jorong Barutama Greston.PT - Indonesia
- Global Business Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- Global Green Power PLC Corporation, Philippines
- Latin American Coal - Colombia
- Aditya Birla Group - India
- GN Power Mariveles Coal Plant, Philippines
- Indika Energy - Indonesia
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- Mercuria Energy - Indonesia
- ASAPP Information Group - India
- Gujarat Sidhee Cement - India
- Billiton Holdings Pty Ltd - Australia
- Grasim Industreis Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Riau Bara Harum - Indonesia
- The University of Queensland
- Madhucon Powers Ltd - India
- Salva Resources Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Wilmar Investment Holdings
- Malabar Cements Ltd - India
- Star Paper Mills Limited - India
- Samtan Co., Ltd - South Korea
- Heidelberg Cement - Germany
- GVK Power & Infra Limited - India
- Sical Logistics Limited - India
- Holcim Trading Pte Ltd - Singapore
- Electricity Authority, New Zealand
- Indian Energy Exchange, India
- Electricity Generating Authority of Thailand
- Central Java Power - Indonesia
- Simpson Spence & Young - Indonesia
- White Energy Company Limited
- Makarim & Taira - Indonesia
- Karaikal Port Pvt Ltd - India
- Edison Trading Spa - Italy
- Independent Power Producers Association of India
- Mintek Dendrill Indonesia
- Therma Luzon, Inc, Philippines
- Wood Mackenzie - Singapore
- Jindal Steel & Power Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Eastern Coal Council - USA
- Petrochimia International Co. Ltd.- Taiwan
- India Bulls Power Limited - India
- Miang Besar Coal Terminal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Binh Thuan Hamico - Vietnam
- Africa Commodities Group - South Africa
- Commonwealth Bank - Australia
- Singapore Mercantile Exchange
- London Commodity Brokers - England
- Kaltim Prima Coal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Australian Coal Association
- Altura Mining Limited, Indonesia
- Barasentosa Lestari - Indonesia
- Chettinad Cement Corporation Ltd - India
- SMC Global Power, Philippines
- Rio Tinto Coal - Australia
- Bharathi Cement Corporation - India
- Bhatia International Limited - India
- Manunggal Multi Energi - Indonesia
- Pendopo Energi Batubara - Indonesia
- Interocean Group of Companies - India
- Bulk Trading Sa - Switzerland
- Romanian Commodities Exchange
- Meralco Power Generation, Philippines
- Goldman Sachs - Singapore
- Medco Energi Mining Internasional
- Planning Commission, India
- AsiaOL BioFuels Corp., Philippines
- Straits Asia Resources Limited - Singapore
- Toyota Tsusho Corporation, Japan
- Bukit Baiduri Energy - Indonesia
- Chamber of Mines of South Africa
- Leighton Contractors Pty Ltd - Australia
- Anglo American - United Kingdom
- Renaissance Capital - South Africa
- Kideco Jaya Agung - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Orica Mining Services - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Coal and Oil Company - UAE
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vedanta Resources Plc - India
- CNBM International Corporation - China
- Global Coal Blending Company Limited - Australia
- MS Steel International - UAE
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tamil Nadu electricity Board
- Formosa Plastics Group - Taiwan
- Iligan Light & Power Inc, Philippines
- Deloitte Consulting - India
- Posco Energy - South Korea
- Vijayanagar Sugar Pvt Ltd - India
- GMR Energy Limited - India
- Agrawal Coal Company - India
- Intertek Mineral Services - Indonesia
- Antam Resourcindo - Indonesia
- Price Waterhouse Coopers - Russia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cement Manufacturers Association - India
- Essar Steel Hazira Ltd - India
- Minerals Council of Australia
- Indonesian Coal Mining Association
- Baramulti Group, Indonesia
- McConnell Dowell - Australia
- Ministry of Transport, Egypt
- Aboitiz Power Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Kumho Petrochemical, South Korea
- Siam City Cement - Thailand
- The Treasury - Australian Government
- Eastern Energy - Thailand
- PNOC Exploration Corporation - Philippines
- CIMB Investment Bank - Malaysia
- Sree Jayajothi Cements Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mjunction Services Limited - India
- Energy Development Corp, Philippines
- SMG Consultants - Indonesia
- Dalmia Cement Bharat India
- Bhushan Steel Limited - India
- Videocon Industries ltd - India
- TeaM Sual Corporation - Philippines
- Bayan Resources Tbk. - Indonesia
- Kobexindo Tractors - Indoneisa
- SN Aboitiz Power Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Oldendorff Carriers - Singapore
- LBH Netherlands Bv - Netherlands
- Vizag Seaport Private Limited - India
- Larsen & Toubro Limited - India
- Bangladesh Power Developement Board
- Siam City Cement PLC, Thailand
- Central Electricity Authority - India
- Trasteel International SA, Italy
- Asmin Koalindo Tuhup - Indonesia
- PTC India Limited - India
- Cigading International Bulk Terminal - Indonesia
- Sojitz Corporation - Japan
- Coastal Gujarat Power Limited - India
- Maheswari Brothers Coal Limited - India
- Economic Council, Georgia
- New Zealand Coal & Carbon
- Power Finance Corporation Ltd., India
- The State Trading Corporation of India Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Banpu Public Company Limited - Thailand
- Directorate Of Revenue Intelligence - India
- Savvy Resources Ltd - HongKong
- Kepco SPC Power Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Ceylon Electricity Board - Sri Lanka
- GAC Shipping (India) Pvt Ltd
- Jaiprakash Power Ventures ltd
- Petron Corporation, Philippines
- Ambuja Cements Ltd - India
- Orica Australia Pty. Ltd.
- Kapuas Tunggal Persada - Indonesia
- Borneo Indobara - Indonesia
- Semirara Mining Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Standard Chartered Bank - UAE
- Mercator Lines Limited - India
- Indogreen Group - Indonesia
- Tata Chemicals Ltd - India
- Georgia Ports Authority, United States
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