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Tuesday, 18 February 20
WEEKLY MARKET ANALYSIS - ALLIED
 Under such poorly performing market circumstances, many usually take the historical approach, in order to better understand and further analyze the present state of the market. However, to what degree is this a "fair" comparison to undertake right now?
According to Thomas Chasapis, Research Analyst of Allied Shipping Research the freight collapse of 2016 in the dry bulk sector has been a reference case for every discussion when the market has undergone any severe downward pressure. However, despite its excessive impact, it was a "known" situation, or to put it more bluntly, it was 'an accident waiting to happen'.
Thomas Chasapis further noted that, the excess tonnage capacity was the result of the massive new order activity that had taken place in years prior, as well as, the disconnected relationship of demand and supply fundamentals, eventually pushing freight earnings to their perceived absolute bottom. After that, the market started to adapt to this new market reality, with more modest orderbook activity and, for a time, massive scrapping activity. This "rebalancing" phase helped translate over to a 2-year period of ever-improving freight market conditions (with some minor corrections here and there), coupled by a more stable market with lower volatility. Suddenly though, from the later part of 2018 the picture was promptly altered. This high-risk environment is not something new for the shipping industry, nor are the periodical exaggerations and asymmetries in realized earnings.
However, Thomas Chasapis, said in his latest research report, having experienced a series of single shock events in such a short period of time, it comes naturally to question the robustness of the different business models. Tail risks and “black swans", won’t be just catch phrases, but a change in investment attitude while we enter a new "era" of how we quantify different kinds of market risks (and their likelihood of being fulfilled).
According to Allied, the COVID-19 outbreak has disrupted most business activities worldwide, with the possible outcomes being numerous and presenting multiple decision directions to practitioners. In other words, we are in a genuine situation, where an absolute comparison to previously noted similar excessive negative pressures would be, to say the least, misleading. Prior to the beginning of this year, the discussion revolved around the potential of a two-tier market unfolding, depending on what type of fuel each vessel would burn. As it turns out and from all that has transpired, we may be experiencing a multi-tier freight market. The Pacific market is in sharp negative territory in terms of earnings, while in the Atlantic, things are relatively more promising (even if not particularly good). Moreover, especially for scrubbers-fitted units, freight rates are following a completely different orbit than what is presented by the quoted Baltic freight indices. The asymmetrical freight market is one of the many bizarre things happening right now. With a certain time-lag, asset prices are likely to follow this steep downward correction (this has not fully materialized yet). With the market in disarray, where uncertainty is the prevailing sentiment, the mispricing of different asset classes is the obvious outcome. The bargain attitude, as well as, the short-term unpredictable outlook has created an excessive "bid-ask spread", indicating a market in distress, unable to properly price both the future risks and trends involved. 2020 has already shown to be a challenging year. Even with a very weak short-term outlook, the market may well absorb most of the negative side effects and eventually return to an upward track much sooner than many expect.
Despite this however, the longer-term macroeconomic trends are still troubling. China is already facing the possibility of losing around 0.5% points from its projected growth for this year, something that would translate over to a significant step back in global seaborne trade, Thomas Chasapis concluded.
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Wednesday, 04 December 19
SHIPPING MARKET INSIGHT - INTERMODAL
Dry bulk freight rates rebounded last week, a development that came as a relief following the recent negative sentiment that prevailed in the marke ...
Wednesday, 04 December 19
INDONESIA REVIEWING RULES MANDATING COAL SALES TO LOCAL BUYERS: OFFICIAL - REUTERS
Indonesia is reviewing rules that require coal miners to sell a portion of their coal to local buyers, a government official said on Monday, as sup ...
Tuesday, 03 December 19
STABILITY AND COMPATIBILITY OF VERY LOW SULPHUR FUEL OILS - GARD
In order to meet increasing restrictions on the sulphur content in marine fuel as defined by MARPOL Annex VI Regulation 14.1.3, the characteristics ...
Monday, 02 December 19
COAL PRODUCTION IN INDIA UP BY 164.58 MT IN 5 YEARS - BUSINESS LINE
Raw coal production in the country has increased from 567.77 million tons (MT) in 2013-14 to 730.35 MT in 2018-19, Union Coal and Parliamentary Aff ...
Monday, 02 December 19
OPEC PREPS FOR OIL'S 2020 BALANCING ACT - WOOD MACKENZIE
What steps should OPEC and its non-OPEC partners take to keep the market in balance in 2020? Ahead of OPEC’s meeting in Vienna on 5 and 6 Dec ...
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- Billiton Holdings Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Directorate General of MIneral and Coal - Indonesia
- GMR Energy Limited - India
- Baramulti Group, Indonesia
- Kumho Petrochemical, South Korea
- Economic Council, Georgia
- Heidelberg Cement - Germany
- Independent Power Producers Association of India
- Indian Oil Corporation Limited
- South Luzon Thermal Energy Corporation
- Kapuas Tunggal Persada - Indonesia
- San Jose City I Power Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Larsen & Toubro Limited - India
- OPG Power Generation Pvt Ltd - India
- Mjunction Services Limited - India
- Lanco Infratech Ltd - India
- LBH Netherlands Bv - Netherlands
- Bulk Trading Sa - Switzerland
- Bangladesh Power Developement Board
- Global Coal Blending Company Limited - Australia
- Vizag Seaport Private Limited - India
- Australian Commodity Traders Exchange
- Orica Mining Services - Indonesia
- Tata Chemicals Ltd - India
- SN Aboitiz Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- Formosa Plastics Group - Taiwan
- PetroVietnam Power Coal Import and Supply Company
- India Bulls Power Limited - India
- Gujarat Sidhee Cement - India
- Directorate Of Revenue Intelligence - India
- Kobexindo Tractors - Indoneisa
- Mintek Dendrill Indonesia
- Alfred C Toepfer International GmbH - Germany
- White Energy Company Limited
- Kaltim Prima Coal - Indonesia
- Sojitz Corporation - Japan
- Africa Commodities Group - South Africa
- Petron Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Aditya Birla Group - India
- Leighton Contractors Pty Ltd - Australia
- Central Electricity Authority - India
- Maharashtra Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Bukit Baiduri Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- Medco Energi Mining Internasional
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Mines - Canada
- Chamber of Mines of South Africa
- Sinarmas Energy and Mining - Indonesia
- Trasteel International SA, Italy
- MS Steel International - UAE
- Rio Tinto Coal - Australia
- Merrill Lynch Commodities Europe
- Port Waratah Coal Services - Australia
- Uttam Galva Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Agrawal Coal Company - India
- Star Paper Mills Limited - India
- Coalindo Energy - Indonesia
- Makarim & Taira - Indonesia
- Intertek Mineral Services - Indonesia
- Indika Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Mercator Lines Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Anglo American - United Kingdom
- Ministry of Finance - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Marubeni Corporation - India
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- TeaM Sual Corporation - Philippines
- GVK Power & Infra Limited - India
- Thai Mozambique Logistica
- Riau Bara Harum - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Central Java Power - Indonesia
- Sakthi Sugars Limited - India
- Coal and Oil Company - UAE
- Krishnapatnam Port Company Ltd. - India
- Ministry of Transport, Egypt
- The University of Queensland
- Savvy Resources Ltd - HongKong
- Bukit Makmur.PT - Indonesia
- Indo Tambangraya Megah - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sarangani Energy Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- The Treasury - Australian Government
- Videocon Industries ltd - India
- Indogreen Group - Indonesia
- Deloitte Consulting - India
- Global Business Power Corporation, Philippines
- Indonesian Coal Mining Association
- Thiess Contractors Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Siam City Cement - Thailand
- Samtan Co., Ltd - South Korea
- Kartika Selabumi Mining - Indonesia
- Vedanta Resources Plc - India
- Pendopo Energi Batubara - Indonesia
- SMC Global Power, Philippines
- ASAPP Information Group - India
- Straits Asia Resources Limited - Singapore
- Edison Trading Spa - Italy
- Renaissance Capital - South Africa
- Parry Sugars Refinery, India
- Barasentosa Lestari - Indonesia
- Minerals Council of Australia
- CIMB Investment Bank - Malaysia
- The State Trading Corporation of India Ltd
- Oldendorff Carriers - Singapore
- Energy Development Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- PowerSource Philippines DevCo
- Dalmia Cement Bharat India
- Grasim Industreis Ltd - India
- Salva Resources Pvt Ltd - India
- London Commodity Brokers - England
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- Toyota Tsusho Corporation, Japan
- Semirara Mining and Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Aboitiz Power Corporation - Philippines
- Timah Investasi Mineral - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- Simpson Spence & Young - Indonesia
- Cement Manufacturers Association - India
- Borneo Indobara - Indonesia
- ICICI Bank Limited - India
- Jindal Steel & Power Ltd - India
- Romanian Commodities Exchange
- Ceylon Electricity Board - Sri Lanka
- Xindia Steels Limited - India
- Antam Resourcindo - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- VISA Power Limited - India
- Manunggal Multi Energi - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Wood Mackenzie - Singapore
- Meenaskhi Energy Private Limited - India
- PNOC Exploration Corporation - Philippines
- Altura Mining Limited, Indonesia
- Coastal Gujarat Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining Corp, Philippines
- Wilmar Investment Holdings
- International Coal Ventures Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- PTC India Limited - India
- Kepco SPC Power Corporation, Philippines
- Power Finance Corporation Ltd., India
- Singapore Mercantile Exchange
- IEA Clean Coal Centre - UK
- Therma Luzon, Inc, Philippines
- Carbofer General Trading SA - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Georgia Ports Authority, United States
- McConnell Dowell - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Sical Logistics Limited - India
- Bhushan Steel Limited - India
- Globalindo Alam Lestari - Indonesia
- Planning Commission, India
- Global Green Power PLC Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Sindya Power Generating Company Private Ltd
- Ambuja Cements Ltd - India
- Commonwealth Bank - Australia
- Orica Australia Pty. Ltd.
- Eastern Coal Council - USA
- Interocean Group of Companies - India
- Holcim Trading Pte Ltd - Singapore
- Bharathi Cement Corporation - India
- Mercuria Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Madhucon Powers Ltd - India
- GAC Shipping (India) Pvt Ltd
- Posco Energy - South Korea
- Iligan Light & Power Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Malabar Cements Ltd - India
- Indian Energy Exchange, India
- Bhatia International Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Chettinad Cement Corporation Ltd - India
- Bhoruka Overseas - Indonesia
- Electricity Generating Authority of Thailand
- Meralco Power Generation, Philippines
- Metalloyd Limited - United Kingdom
- Electricity Authority, New Zealand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Standard Chartered Bank - UAE
- New Zealand Coal & Carbon
- Australian Coal Association
- Energy Link Ltd, New Zealand
- Eastern Energy - Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karbindo Abesyapradhi - Indoneisa
- Goldman Sachs - Singapore
- Parliament of New Zealand
- CNBM International Corporation - China
- Asmin Koalindo Tuhup - Indonesia
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