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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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Monday, 21 October 19
COAL TO PLAY SIGNIFICANT ROLE IN SOUTH AFRICA POWER MIX - MINISTER, REUTERS REPORTED
South Africa’s plans for additional power generation over the next decade will involve a variety of energy sources, with coal still playing a ...
Monday, 21 October 19
ULTRAMAX: IN ASIA, TRIPS FROM THE SINGAPORE AREA WERE PAYING BETWEEN $14,000 AND $16,000, DEPENDING ON THE VESSEL SIZE AND DURATION - BALTIC BRIEFING
Capesize
The market traded in a relatively stable supported manner in the Pacific this week while the Atlantic experienced weakening turbulence ...
Friday, 18 October 19
WHY CRUDE TANKER RATES JUST FELL (HALFWAY) BACK TO EARTH - FREIGHT WAVES
Panic drove crude-tanker rates up, very briefly, to mind-bogglingly high assessed levels of around $300,000 per day. Now, the fear factor has been ...
Friday, 18 October 19
SHORT TERM STRENGTH FOR OZ COMMODITIES - BALTIC BRIEFING
Volatility in the global commodity markets is not expected to unduly rattle Australia’s commodity outlook through 2020, but the 2021 picture ...
Friday, 18 October 19
SINGAPORE'S APEX TO LAUNCH LOW-SULFUR FUEL OIL CONTRACT AHEAD OF NEW SHIPPING RULES - REUTERS
Singapore-based Asia Pacific Exchange (APEX) will launch a low-sulfur fuel oil (LSFO) futures contract on Friday aimed at helping shipping and ener ...
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- Electricity Generating Authority of Thailand
- Intertek Mineral Services - Indonesia
- Thiess Contractors Indonesia
- Metalloyd Limited - United Kingdom
- Siam City Cement - Thailand
- Semirara Mining Corp, Philippines
- Oldendorff Carriers - Singapore
- Edison Trading Spa - Italy
- Aditya Birla Group - India
- Price Waterhouse Coopers - Russia
- Vijayanagar Sugar Pvt Ltd - India
- Marubeni Corporation - India
- Cement Manufacturers Association - India
- Indonesian Coal Mining Association
- ASAPP Information Group - India
- PTC India Limited - India
- Bharathi Cement Corporation - India
- Rio Tinto Coal - Australia
- Ambuja Cements Ltd - India
- Georgia Ports Authority, United States
- IEA Clean Coal Centre - UK
- Global Coal Blending Company Limited - Australia
- Toyota Tsusho Corporation, Japan
- Xindia Steels Limited - India
- Gujarat Sidhee Cement - India
- McConnell Dowell - Australia
- Agrawal Coal Company - India
- Bahari Cakrawala Sebuku - Indonesia
- Sree Jayajothi Cements Limited - India
- Australian Commodity Traders Exchange
- Bulk Trading Sa - Switzerland
- Asmin Koalindo Tuhup - Indonesia
- Mercator Lines Limited - India
- Rashtriya Ispat Nigam Limited - India
- London Commodity Brokers - England
- Karaikal Port Pvt Ltd - India
- Tamil Nadu electricity Board
- Essar Steel Hazira Ltd - India
- Sical Logistics Limited - India
- Krishnapatnam Port Company Ltd. - India
- Energy Development Corp, Philippines
- Formosa Plastics Group - Taiwan
- OPG Power Generation Pvt Ltd - India
- Medco Energi Mining Internasional
- Mercuria Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Binh Thuan Hamico - Vietnam
- The State Trading Corporation of India Ltd
- Central Java Power - Indonesia
- SMG Consultants - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Banpu Public Company Limited - Thailand
- Vedanta Resources Plc - India
- Pipit Mutiara Jaya. PT, Indonesia
- Singapore Mercantile Exchange
- Kumho Petrochemical, South Korea
- Pendopo Energi Batubara - Indonesia
- Renaissance Capital - South Africa
- Sinarmas Energy and Mining - Indonesia
- International Coal Ventures Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Sindya Power Generating Company Private Ltd
- Sarangani Energy Corporation, Philippines
- Economic Council, Georgia
- Savvy Resources Ltd - HongKong
- Siam City Cement PLC, Thailand
- Antam Resourcindo - Indonesia
- Aboitiz Power Corporation - Philippines
- Malabar Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Billiton Holdings Pty Ltd - Australia
- VISA Power Limited - India
- Bayan Resources Tbk. - Indonesia
- Holcim Trading Pte Ltd - Singapore
- The University of Queensland
- Coastal Gujarat Power Limited - India
- Petron Corporation, Philippines
- Indogreen Group - Indonesia
- Kobexindo Tractors - Indoneisa
- Cigading International Bulk Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Directorate Of Revenue Intelligence - India
- Riau Bara Harum - Indonesia
- Power Finance Corporation Ltd., India
- Samtan Co., Ltd - South Korea
- Parry Sugars Refinery, India
- Ministry of Finance - Indonesia
- Vizag Seaport Private Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Madhucon Powers Ltd - India
- Goldman Sachs - Singapore
- Standard Chartered Bank - UAE
- Independent Power Producers Association of India
- SN Aboitiz Power Inc, Philippines
- Videocon Industries ltd - India
- White Energy Company Limited
- Indian Oil Corporation Limited
- Tata Chemicals Ltd - India
- European Bulk Services B.V. - Netherlands
- Larsen & Toubro Limited - India
- Bhushan Steel Limited - India
- Minerals Council of Australia
- Semirara Mining and Power Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Merrill Lynch Commodities Europe
- Iligan Light & Power Inc, Philippines
- Deloitte Consulting - India
- Mintek Dendrill Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Globalindo Alam Lestari - Indonesia
- Dalmia Cement Bharat India
- Leighton Contractors Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- Timah Investasi Mineral - Indoneisa
- Commonwealth Bank - Australia
- Baramulti Group, Indonesia
- Indika Energy - Indonesia
- Attock Cement Pakistan Limited
- Indo Tambangraya Megah - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kalimantan Lumbung Energi - Indonesia
- GVK Power & Infra Limited - India
- Salva Resources Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- ICICI Bank Limited - India
- Meralco Power Generation, Philippines
- Wood Mackenzie - Singapore
- Chamber of Mines of South Africa
- Eastern Energy - Thailand
- Gujarat Electricity Regulatory Commission - India
- Romanian Commodities Exchange
- Planning Commission, India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- The Treasury - Australian Government
- Makarim & Taira - Indonesia
- PNOC Exploration Corporation - Philippines
- Eastern Coal Council - USA
- Uttam Galva Steels Limited - India
- Star Paper Mills Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Australian Coal Association
- Gujarat Mineral Development Corp Ltd - India
- Bukit Baiduri Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- India Bulls Power Limited - India
- TeaM Sual Corporation - Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- Borneo Indobara - Indonesia
- Manunggal Multi Energi - Indonesia
- SMC Global Power, Philippines
- Kideco Jaya Agung - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Indian Energy Exchange, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Business Power Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- IHS Mccloskey Coal Group - USA
- Jindal Steel & Power Ltd - India
- Simpson Spence & Young - Indonesia
- Mjunction Services Limited - India
- Ministry of Transport, Egypt
- Ceylon Electricity Board - Sri Lanka
- LBH Netherlands Bv - Netherlands
- Bhatia International Limited - India
- Energy Link Ltd, New Zealand
- Straits Asia Resources Limited - Singapore
- Orica Australia Pty. Ltd.
- Thai Mozambique Logistica
- San Jose City I Power Corp, Philippines
- Miang Besar Coal Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Sojitz Corporation - Japan
- Lanco Infratech Ltd - India
- Posco Energy - South Korea
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Barasentosa Lestari - Indonesia
- Bukit Makmur.PT - Indonesia
- Sakthi Sugars Limited - India
- Meenaskhi Energy Private Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Orica Mining Services - Indonesia
- CNBM International Corporation - China
- Carbofer General Trading SA - India
- MS Steel International - UAE
- Kepco SPC Power Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Africa Commodities Group - South Africa
- Electricity Authority, New Zealand
- Central Electricity Authority - India
- Ministry of Mines - Canada
- Maheswari Brothers Coal Limited - India
- Latin American Coal - Colombia
- Coalindo Energy - Indonesia
- GMR Energy Limited - India
- Wilmar Investment Holdings
- South Luzon Thermal Energy Corporation
- Therma Luzon, Inc, Philippines
- PowerSource Philippines DevCo
- Coal and Oil Company - UAE
- Parliament of New Zealand
- Chettinad Cement Corporation Ltd - India
- Global Green Power PLC Corporation, Philippines
- New Zealand Coal & Carbon
- Ind-Barath Power Infra Limited - India
- Grasim Industreis Ltd - India
- CIMB Investment Bank - Malaysia
- Altura Mining Limited, Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Heidelberg Cement - Germany
- Interocean Group of Companies - India
- Anglo American - United Kingdom
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