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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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Thursday, 24 October 19
PANAMAX: NEGATIVE SENTIMENT IN THE MARKET AS IT CONTINUES TO WEAKEN - FEARNLEYS
Capesize
The market has continued to slide the last week, as lack of fresh requirements and a slight oversupply of tonnage heading towards Sout ...
Wednesday, 23 October 19
CHINA'S 2019 COAL IMPORTS SET TO RISE MORE THAN 10%: ANALYSTS - REUTERS
China, the world’s top coal buyer, is on track to boost imports of the fuel by more than 10% this year, traders and analysts said on Tuesday, ...
Wednesday, 23 October 19
SHIPPING MARKET INSIGHT - INTERMODAL
Moving closer to the end of the year, we are facing what the market was expecting for quite a while, the ship repair sector booming with the shipya ...
Tuesday, 22 October 19
DRY BULK: DESPITE THE DOWNWARD CORRECTION NOTED OVER THE PAST MONTH, RATES ARE STILL HOLDING OFF AT FAVORABLE LEVELS - ALLIED SHIPPING
Despite the downward correction that has been noted in the dry bulk market over the past month, rates are still holding off at favorable levels. Ev ...
Monday, 21 October 19
SHIPPERS CHANGE COURSE AS FUEL RULES TARGET SULPHUR EMISSIONS - WOOD MACKENZIE
The International Maritime Organization (IMO), the industry’s regulator, will require all ships to reduce the level of sulphur in their engin ...
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- Meenaskhi Energy Private Limited - India
- TeaM Sual Corporation - Philippines
- Semirara Mining Corp, Philippines
- Mintek Dendrill Indonesia
- Samtan Co., Ltd - South Korea
- Globalindo Alam Lestari - Indonesia
- Bayan Resources Tbk. - Indonesia
- Altura Mining Limited, Indonesia
- Trasteel International SA, Italy
- Thiess Contractors Indonesia
- Georgia Ports Authority, United States
- Meralco Power Generation, Philippines
- Star Paper Mills Limited - India
- Bhoruka Overseas - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Ind-Barath Power Infra Limited - India
- Cement Manufacturers Association - India
- Bukit Makmur.PT - Indonesia
- The University of Queensland
- Gujarat Sidhee Cement - India
- Gujarat Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Indogreen Group - Indonesia
- CIMB Investment Bank - Malaysia
- Banpu Public Company Limited - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Manunggal Multi Energi - Indonesia
- SN Aboitiz Power Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Semirara Mining and Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Merrill Lynch Commodities Europe
- Oldendorff Carriers - Singapore
- Xindia Steels Limited - India
- San Jose City I Power Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Minerals Council of Australia
- Global Green Power PLC Corporation, Philippines
- Makarim & Taira - Indonesia
- Wood Mackenzie - Singapore
- Attock Cement Pakistan Limited
- Petrochimia International Co. Ltd.- Taiwan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vedanta Resources Plc - India
- Holcim Trading Pte Ltd - Singapore
- Baramulti Group, Indonesia
- Billiton Holdings Pty Ltd - Australia
- Australian Coal Association
- Sinarmas Energy and Mining - Indonesia
- Posco Energy - South Korea
- Bukit Baiduri Energy - Indonesia
- Mercator Lines Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Kepco SPC Power Corporation, Philippines
- Sakthi Sugars Limited - India
- Orica Australia Pty. Ltd.
- SMG Consultants - Indonesia
- Carbofer General Trading SA - India
- Metalloyd Limited - United Kingdom
- Agrawal Coal Company - India
- Eastern Energy - Thailand
- ASAPP Information Group - India
- Tata Chemicals Ltd - India
- Anglo American - United Kingdom
- CNBM International Corporation - China
- Directorate Of Revenue Intelligence - India
- Coal and Oil Company - UAE
- Formosa Plastics Group - Taiwan
- International Coal Ventures Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Pendopo Energi Batubara - Indonesia
- Goldman Sachs - Singapore
- Parliament of New Zealand
- Bhatia International Limited - India
- Iligan Light & Power Inc, Philippines
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Global Business Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Ambuja Cements Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Deloitte Consulting - India
- Central Electricity Authority - India
- Mjunction Services Limited - India
- Power Finance Corporation Ltd., India
- Indonesian Coal Mining Association
- Bukit Asam (Persero) Tbk - Indonesia
- Kobexindo Tractors - Indoneisa
- Energy Link Ltd, New Zealand
- Indian Oil Corporation Limited
- Riau Bara Harum - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jindal Steel & Power Ltd - India
- Sarangani Energy Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ministry of Transport, Egypt
- Electricity Authority, New Zealand
- Savvy Resources Ltd - HongKong
- GMR Energy Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Maheswari Brothers Coal Limited - India
- Simpson Spence & Young - Indonesia
- McConnell Dowell - Australia
- Chettinad Cement Corporation Ltd - India
- Salva Resources Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Petron Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Thai Mozambique Logistica
- Siam City Cement - Thailand
- PTC India Limited - India
- Price Waterhouse Coopers - Russia
- Borneo Indobara - Indonesia
- Toyota Tsusho Corporation, Japan
- Kumho Petrochemical, South Korea
- Krishnapatnam Port Company Ltd. - India
- Straits Asia Resources Limited - Singapore
- Heidelberg Cement - Germany
- Karbindo Abesyapradhi - Indoneisa
- PetroVietnam Power Coal Import and Supply Company
- India Bulls Power Limited - India
- Malabar Cements Ltd - India
- Central Java Power - Indonesia
- Bhushan Steel Limited - India
- Karaikal Port Pvt Ltd - India
- Mercuria Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Singapore Mercantile Exchange
- Edison Trading Spa - Italy
- Kideco Jaya Agung - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Marubeni Corporation - India
- Africa Commodities Group - South Africa
- Planning Commission, India
- Romanian Commodities Exchange
- Tamil Nadu electricity Board
- Bangladesh Power Developement Board
- PowerSource Philippines DevCo
- The State Trading Corporation of India Ltd
- Intertek Mineral Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Global Coal Blending Company Limited - Australia
- Uttam Galva Steels Limited - India
- Grasim Industreis Ltd - India
- Therma Luzon, Inc, Philippines
- Antam Resourcindo - Indonesia
- Ministry of Mines - Canada
- Larsen & Toubro Limited - India
- Binh Thuan Hamico - Vietnam
- Kaltim Prima Coal - Indonesia
- Barasentosa Lestari - Indonesia
- The Treasury - Australian Government
- Interocean Group of Companies - India
- Economic Council, Georgia
- Parry Sugars Refinery, India
- Maharashtra Electricity Regulatory Commission - India
- Kapuas Tunggal Persada - Indonesia
- Indika Energy - Indonesia
- Rio Tinto Coal - Australia
- Energy Development Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Ceylon Electricity Board - Sri Lanka
- Coalindo Energy - Indonesia
- European Bulk Services B.V. - Netherlands
- GVK Power & Infra Limited - India
- Electricity Generating Authority of Thailand
- Lanco Infratech Ltd - India
- Wilmar Investment Holdings
- Dalmia Cement Bharat India
- Bharathi Cement Corporation - India
- Pipit Mutiara Jaya. PT, Indonesia
- AsiaOL BioFuels Corp., Philippines
- Sojitz Corporation - Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- MS Steel International - UAE
- PNOC Exploration Corporation - Philippines
- Medco Energi Mining Internasional
- IEA Clean Coal Centre - UK
- Essar Steel Hazira Ltd - India
- Chamber of Mines of South Africa
- Vizag Seaport Private Limited - India
- Jaiprakash Power Ventures ltd
- Madhucon Powers Ltd - India
- White Energy Company Limited
- Independent Power Producers Association of India
- Indian Energy Exchange, India
- Eastern Coal Council - USA
- ICICI Bank Limited - India
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Australian Commodity Traders Exchange
- Rashtriya Ispat Nigam Limited - India
- VISA Power Limited - India
- Aboitiz Power Corporation - Philippines
- Commonwealth Bank - Australia
- Latin American Coal - Colombia
- London Commodity Brokers - England
- Aditya Birla Group - India
- Directorate General of MIneral and Coal - Indonesia
- Coastal Gujarat Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Ministry of Finance - Indonesia
- Sical Logistics Limited - India
- SMC Global Power, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Bulk Trading Sa - Switzerland
- Siam City Cement PLC, Thailand
- Port Waratah Coal Services - Australia
- Kartika Selabumi Mining - Indonesia
- Leighton Contractors Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- New Zealand Coal & Carbon
- LBH Netherlands Bv - Netherlands
- Renaissance Capital - South Africa
- Miang Besar Coal Terminal - Indonesia
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