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Friday, 13 November 20
SHIPPING OUTLOOK TURNS STABLE ON EBITDA GROWTH, IMPROVING SUPPLY-DEMAND BALANCE - MOODY’S
 Outlook revised to stable from negative.
The global shipping industry is on course to perform better overall than we had previously expected this year. We expect the aggregate EBITDA of the shipping companies we rate globally to grow by 3%-5% in 2021, driven by a recovery in the dry bulk segment from pandemic lows and the continuance of good market fundamentals for container shipping. However, this is tempered by a likely decline in EBITDA in the tanker segment next year because of tough comparisons with record charter rates in the first half of 2020. The industry’s overall supply-demand balance is set to improve in 2021, which is the other main reason for the outlook change. However, risks remain. A tenuous global economic recovery has taken hold but ongoing pandemic fears and a resurgence in coronavirus infections in some major economies could hinder a recovery in demand for shipping services in 2021. Our outlook for the global shipping industry had been negative since March 2020.
Limited supply of new vessels and capacity management should act as a cushion to adverse market conditions.
Order books for all three shipping segments remain at record low levels in relation to their total fleets. As Exhibit 2 shows, even absent a real recovery or demand contracting moderately, the different segments would see limited growth in new capacity. In the container shipping segment, carriers could resume cancellations of sailings to reduce capacity to match demand. However, the tanker and dry bulk markets will be more sensitive to changes in demand during 2021 because they are much more fragmented than the global container market where capacity is partly organised through alliances.
Our view for the container shipping segment has changed to stable from negative. Following very disciplined capacity management by carriers, low bunker prices and increasing freight rates as demand recovered in the second half of 2020, the container shipping industry will record one of its strongest years since 2010. With supply and demand likely to be in balance given the very limited order book for new vessels, we expect a stable operating environment in 2021. Even if the global economic recovery takes longer to materialise, given the rising infections in Europe and the US, carriers’ capacity management should continue to keep freight rates broadly stable.
Our view for the dry bulk segment has changed to stable from negative. This is anchored in our expectations that the trough for dry bulk shipping companies likely happened during the second quarter of 2020 and that the market environment should gradually improve over the next 12-18 months. The recovery in key dry-bulk commodities has been more or less driven by China, where import volumes of iron ore were 11% higher in the year to date to August than in the same period in 2019. The supplydemand balance is also set to improve. Assuming the global economy recovers in 2021, we foresee dry bulk demand growing by 3%-5% versus supply growth ranging from 0.5% to 2%, depending on the level of scrapping activity and order delays/cancellations. Still, downside risks are certainly evident, including protracted lockdowns that would curb demand.
Our view for the tanker segment has changed to negative from stable. Tanker operators had a very strong first half of the year as the mix of a sudden collapse in oil prices and maintained production resulted in high demand for floating storage, particularly for very large crude carriers (VLCCs). As a result, charter rates reached record highs in the March to May period this year, but have weakened since with recent VLCC rates around half of the peak levels earlier this year. A substantial part of the fleet remains in floating storage or idle, a temporary effect that is likely to reverse, although a reversal may also result in higher scrapping. While oil demand continues to recover, fleet order books remain manageable and charter rates may seasonally rise in the fourth quarter of 2020, we believe that EBITDA in this shipping segment will contract in 2021 as the as the exceptional Q2 environment is unlikely to be repeated.
What could change the outlook. We would consider revising the outlook to positive if both the oversupply of vessels declines materially and comparable year-over-year EBITDA growth appears likely to exceed 10%. We would consider changing the outlook to negative if we see signs that shipping supply growth will exceed demand growth by more than 2% or that comparable EBITDA will decline by more than 5% year over year
Since outlooks represent our forward-looking view on business conditions that factor into our ratings, a negative (positive) outlook suggests that negative (positive) rating actions are more likely on average. However, the industry outlook does not represent a sum of upgrades, downgrades or ratings under review, or an average of the rating outlooks of issuers in the industry, but rather our assessment of the main direction of business fundamentals within the overall industry.
Source: Moody’s
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Wednesday, 25 November 20
DRY BULK SHIPPING: CHINA REMAINS THE DRIVING FACTOR, BUT COAL POLICY IS DISRUPTING THE MARKET - PETER SAND, BIMCO
The second half of the year has provided some cheer for the dry bulk market, with all ships in the spot market averaging earnings above the break-e ...
Wednesday, 25 November 20
CHINA KICKS AN OWN GOAL WITH AUSTRALIAN COAL - FORBES
China’s annoyance at Australia’s hardline stance on political interference and demands for an independent inquiry into the root cause o ...
Wednesday, 25 November 20
MINISTER - INDONESIA JAN-OCT COAL OUTPUT AT 459 MILLION TONNES - REUTERS
Indonesia coal output in the January to October period was 459 million tonnes, the country’s energy minister told parliament on Monday.
& ...
Wednesday, 25 November 20
INDIA: MORE STEPS NEEDED TO MAKE COMMERCIAL COAL MINING ATTRACTIVE TO GLOBAL PLAYERS - LIVEMINT
India concluded its first commercial coal mine auctions earlier this month. A total of 19 coal mines spread across Madhya Pradesh, Jharkhand, Odish ...
Wednesday, 25 November 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX UP 0.38 PCT - XINHUA
China Taiyuan coal transaction price index stood at 129.21 points Monday, up 0.38 percent week on week.
The index, released by China ...
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- Chettinad Cement Corporation Ltd - India
- Commonwealth Bank - Australia
- Formosa Plastics Group - Taiwan
- Sree Jayajothi Cements Limited - India
- Bangladesh Power Developement Board
- Tamil Nadu electricity Board
- Ministry of Finance - Indonesia
- Mercuria Energy - Indonesia
- Kumho Petrochemical, South Korea
- SMC Global Power, Philippines
- Carbofer General Trading SA - India
- Indika Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Ministry of Mines - Canada
- Goldman Sachs - Singapore
- Latin American Coal - Colombia
- Minerals Council of Australia
- MS Steel International - UAE
- Orica Australia Pty. Ltd.
- Chamber of Mines of South Africa
- CNBM International Corporation - China
- Indo Tambangraya Megah - Indonesia
- Ambuja Cements Ltd - India
- Coastal Gujarat Power Limited - India
- Lanco Infratech Ltd - India
- The Treasury - Australian Government
- Eastern Coal Council - USA
- Asia Pacific Energy Resources Ventures Inc, Philippines
- SN Aboitiz Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Straits Asia Resources Limited - Singapore
- Africa Commodities Group - South Africa
- Aditya Birla Group - India
- Coal and Oil Company - UAE
- Medco Energi Mining Internasional
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- IHS Mccloskey Coal Group - USA
- GMR Energy Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Star Paper Mills Limited - India
- Central Java Power - Indonesia
- Bayan Resources Tbk. - Indonesia
- Parry Sugars Refinery, India
- Ind-Barath Power Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- Globalindo Alam Lestari - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Sarangani Energy Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Marubeni Corporation - India
- Eastern Energy - Thailand
- SMG Consultants - Indonesia
- Timah Investasi Mineral - Indoneisa
- CIMB Investment Bank - Malaysia
- Bulk Trading Sa - Switzerland
- Leighton Contractors Pty Ltd - Australia
- PowerSource Philippines DevCo
- Deloitte Consulting - India
- Global Green Power PLC Corporation, Philippines
- Energy Link Ltd, New Zealand
- Mintek Dendrill Indonesia
- Xindia Steels Limited - India
- GN Power Mariveles Coal Plant, Philippines
- European Bulk Services B.V. - Netherlands
- Agrawal Coal Company - India
- San Jose City I Power Corp, Philippines
- Global Business Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Port Waratah Coal Services - Australia
- Romanian Commodities Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Siam City Cement PLC, Thailand
- Sindya Power Generating Company Private Ltd
- Power Finance Corporation Ltd., India
- Sinarmas Energy and Mining - Indonesia
- Grasim Industreis Ltd - India
- Indian Energy Exchange, India
- Krishnapatnam Port Company Ltd. - India
- International Coal Ventures Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Iligan Light & Power Inc, Philippines
- IEA Clean Coal Centre - UK
- Bhatia International Limited - India
- Rio Tinto Coal - Australia
- Planning Commission, India
- Uttam Galva Steels Limited - India
- Wood Mackenzie - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Economic Council, Georgia
- Barasentosa Lestari - Indonesia
- Semirara Mining Corp, Philippines
- Vedanta Resources Plc - India
- Pipit Mutiara Jaya. PT, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- White Energy Company Limited
- Salva Resources Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Siam City Cement - Thailand
- Coalindo Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Sical Logistics Limited - India
- Maheswari Brothers Coal Limited - India
- Metalloyd Limited - United Kingdom
- London Commodity Brokers - England
- Independent Power Producers Association of India
- Kepco SPC Power Corporation, Philippines
- ICICI Bank Limited - India
- Anglo American - United Kingdom
- Mjunction Services Limited - India
- Toyota Tsusho Corporation, Japan
- VISA Power Limited - India
- Borneo Indobara - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Thai Mozambique Logistica
- India Bulls Power Limited - India
- McConnell Dowell - Australia
- Kohat Cement Company Ltd. - Pakistan
- Savvy Resources Ltd - HongKong
- Interocean Group of Companies - India
- Riau Bara Harum - Indonesia
- Electricity Authority, New Zealand
- Sojitz Corporation - Japan
- Semirara Mining and Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- The University of Queensland
- South Luzon Thermal Energy Corporation
- Price Waterhouse Coopers - Russia
- Kaltim Prima Coal - Indonesia
- Samtan Co., Ltd - South Korea
- Pendopo Energi Batubara - Indonesia
- Essar Steel Hazira Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Bharathi Cement Corporation - India
- Parliament of New Zealand
- Gujarat Mineral Development Corp Ltd - India
- The State Trading Corporation of India Ltd
- Dalmia Cement Bharat India
- Trasteel International SA, Italy
- Makarim & Taira - Indonesia
- Banpu Public Company Limited - Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Antam Resourcindo - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- ASAPP Information Group - India
- Asmin Koalindo Tuhup - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Intertek Mineral Services - Indonesia
- Vizag Seaport Private Limited - India
- Directorate Of Revenue Intelligence - India
- Gujarat Electricity Regulatory Commission - India
- Malabar Cements Ltd - India
- Petron Corporation, Philippines
- Singapore Mercantile Exchange
- PNOC Exploration Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Sakthi Sugars Limited - India
- Binh Thuan Hamico - Vietnam
- Therma Luzon, Inc, Philippines
- Attock Cement Pakistan Limited
- Altura Mining Limited, Indonesia
- Australian Commodity Traders Exchange
- Bukit Baiduri Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Baramulti Group, Indonesia
- Renaissance Capital - South Africa
- Rashtriya Ispat Nigam Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kartika Selabumi Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jorong Barutama Greston.PT - Indonesia
- Central Electricity Authority - India
- Global Coal Blending Company Limited - Australia
- Energy Development Corp, Philippines
- Thiess Contractors Indonesia
- Heidelberg Cement - Germany
- Cement Manufacturers Association - India
- Madhucon Powers Ltd - India
- Aboitiz Power Corporation - Philippines
- OPG Power Generation Pvt Ltd - India
- PTC India Limited - India
- Karaikal Port Pvt Ltd - India
- Bhushan Steel Limited - India
- Wilmar Investment Holdings
- GAC Shipping (India) Pvt Ltd
- AsiaOL BioFuels Corp., Philippines
- Cigading International Bulk Terminal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Larsen & Toubro Limited - India
- Jaiprakash Power Ventures ltd
- GVK Power & Infra Limited - India
- Australian Coal Association
- Indogreen Group - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indonesian Coal Mining Association
- Gujarat Sidhee Cement - India
- Ministry of Transport, Egypt
- TNB Fuel Sdn Bhd - Malaysia
- Orica Mining Services - Indonesia
- Kideco Jaya Agung - Indonesia
- Mercator Lines Limited - India
- Simpson Spence & Young - Indonesia
- Edison Trading Spa - Italy
- Georgia Ports Authority, United States
- Meralco Power Generation, Philippines
- New Zealand Coal & Carbon
- Videocon Industries ltd - India
- Indian Oil Corporation Limited
- Standard Chartered Bank - UAE
- LBH Netherlands Bv - Netherlands
- Kobexindo Tractors - Indoneisa
- Manunggal Multi Energi - Indonesia
- Posco Energy - South Korea
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