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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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Tuesday, 17 November 20
AUSTRALIAN COAL EXPORTS TO CHINA SLUMP, BUT PRICES ARE MIXED - REUTERS
China’s unofficial ban on coal imports from Australia is starting to take its toll on volumes, with departing cargoes down sharply so far in ...
Friday, 13 November 20
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Monday, 09 November 20
INDONESIA MAY CUT BIODIESEL USE TARGET AS SUBSIDY FUND DEPLETES - FITCH
The Indonesian government may rein in its push to increase use of biodiesel as it now comes at higher cost following a fall in crude oil prices and ...
Monday, 09 November 20
SOUTH AFRICA: COAL MARKET CONDITIONS HAVE ' DETERIORATED MATERIALLY' - IEEFA
The Asian seaborne thermal coal pool is drying out
Resource Generation Ltd’s proposed but long delayed Boikarabelo coal mine i ...
Friday, 06 November 20
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
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- Parry Sugars Refinery, India
- Global Green Power PLC Corporation, Philippines
- Aditya Birla Group - India
- OPG Power Generation Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Xindia Steels Limited - India
- VISA Power Limited - India
- Power Finance Corporation Ltd., India
- Semirara Mining Corp, Philippines
- Altura Mining Limited, Indonesia
- Deloitte Consulting - India
- Holcim Trading Pte Ltd - Singapore
- PowerSource Philippines DevCo
- Edison Trading Spa - Italy
- Larsen & Toubro Limited - India
- Videocon Industries ltd - India
- Global Business Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Romanian Commodities Exchange
- ASAPP Information Group - India
- Singapore Mercantile Exchange
- Jorong Barutama Greston.PT - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Tamil Nadu electricity Board
- PTC India Limited - India
- Ministry of Finance - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maheswari Brothers Coal Limited - India
- Minerals Council of Australia
- Manunggal Multi Energi - Indonesia
- Sakthi Sugars Limited - India
- LBH Netherlands Bv - Netherlands
- Makarim & Taira - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Tata Chemicals Ltd - India
- Binh Thuan Hamico - Vietnam
- Latin American Coal - Colombia
- Bukit Baiduri Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Sidhee Cement - India
- PetroVietnam Power Coal Import and Supply Company
- Salva Resources Pvt Ltd - India
- Petron Corporation, Philippines
- McConnell Dowell - Australia
- Orica Australia Pty. Ltd.
- Meenaskhi Energy Private Limited - India
- Jindal Steel & Power Ltd - India
- Indika Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Directorate General of MIneral and Coal - Indonesia
- Straits Asia Resources Limited - Singapore
- Metalloyd Limited - United Kingdom
- Oldendorff Carriers - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- Medco Energi Mining Internasional
- Formosa Plastics Group - Taiwan
- SN Aboitiz Power Inc, Philippines
- Madhucon Powers Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Coal and Oil Company - UAE
- Orica Mining Services - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Ministry of Transport, Egypt
- South Luzon Thermal Energy Corporation
- SMC Global Power, Philippines
- Carbofer General Trading SA - India
- Indian Energy Exchange, India
- Interocean Group of Companies - India
- Electricity Generating Authority of Thailand
- Posco Energy - South Korea
- Asmin Koalindo Tuhup - Indonesia
- Timah Investasi Mineral - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- White Energy Company Limited
- Wood Mackenzie - Singapore
- GMR Energy Limited - India
- Ind-Barath Power Infra Limited - India
- Thiess Contractors Indonesia
- Siam City Cement PLC, Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Malabar Cements Ltd - India
- Port Waratah Coal Services - Australia
- Indian Oil Corporation Limited
- Renaissance Capital - South Africa
- Sojitz Corporation - Japan
- Standard Chartered Bank - UAE
- Cigading International Bulk Terminal - Indonesia
- CNBM International Corporation - China
- Sindya Power Generating Company Private Ltd
- Kobexindo Tractors - Indoneisa
- Essar Steel Hazira Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Central Java Power - Indonesia
- Sree Jayajothi Cements Limited - India
- Price Waterhouse Coopers - Russia
- Ceylon Electricity Board - Sri Lanka
- Bukit Asam (Persero) Tbk - Indonesia
- IHS Mccloskey Coal Group - USA
- Mjunction Services Limited - India
- New Zealand Coal & Carbon
- Mercator Lines Limited - India
- Trasteel International SA, Italy
- Coalindo Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Grasim Industreis Ltd - India
- Chettinad Cement Corporation Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Marubeni Corporation - India
- Eastern Coal Council - USA
- Attock Cement Pakistan Limited
- Goldman Sachs - Singapore
- IEA Clean Coal Centre - UK
- Indonesian Coal Mining Association
- The State Trading Corporation of India Ltd
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- Australian Commodity Traders Exchange
- Bulk Trading Sa - Switzerland
- London Commodity Brokers - England
- Energy Development Corp, Philippines
- SMG Consultants - Indonesia
- Rio Tinto Coal - Australia
- GN Power Mariveles Coal Plant, Philippines
- Dalmia Cement Bharat India
- Leighton Contractors Pty Ltd - Australia
- Bhatia International Limited - India
- India Bulls Power Limited - India
- Uttam Galva Steels Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Commonwealth Bank - Australia
- Bayan Resources Tbk. - Indonesia
- Indo Tambangraya Megah - Indonesia
- Cement Manufacturers Association - India
- Mercuria Energy - Indonesia
- The Treasury - Australian Government
- Kumho Petrochemical, South Korea
- ICICI Bank Limited - India
- Billiton Holdings Pty Ltd - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Barasentosa Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Bhushan Steel Limited - India
- Anglo American - United Kingdom
- Thai Mozambique Logistica
- Georgia Ports Authority, United States
- TNB Fuel Sdn Bhd - Malaysia
- Energy Link Ltd, New Zealand
- Bhoruka Overseas - Indonesia
- Bangladesh Power Developement Board
- Iligan Light & Power Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Agrawal Coal Company - India
- CIMB Investment Bank - Malaysia
- Lanco Infratech Ltd - India
- Antam Resourcindo - Indonesia
- Indogreen Group - Indonesia
- Central Electricity Authority - India
- Planning Commission, India
- Chamber of Mines of South Africa
- Merrill Lynch Commodities Europe
- Borneo Indobara - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GVK Power & Infra Limited - India
- European Bulk Services B.V. - Netherlands
- Riau Bara Harum - Indonesia
- Vedanta Resources Plc - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- MS Steel International - UAE
- Bharathi Cement Corporation - India
- Baramulti Group, Indonesia
- Australian Coal Association
- GAC Shipping (India) Pvt Ltd
- Kepco SPC Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- TeaM Sual Corporation - Philippines
- Parliament of New Zealand
- Ministry of Mines - Canada
- Aboitiz Power Corporation - Philippines
- Jaiprakash Power Ventures ltd
- Bukit Makmur.PT - Indonesia
- Savvy Resources Ltd - HongKong
- Independent Power Producers Association of India
- Meralco Power Generation, Philippines
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- The University of Queensland
- Miang Besar Coal Terminal - Indonesia
- Mintek Dendrill Indonesia
- Siam City Cement - Thailand
- Vizag Seaport Private Limited - India
- Sical Logistics Limited - India
- PNOC Exploration Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Star Paper Mills Limited - India
- Alfred C Toepfer International GmbH - Germany
- Eastern Energy - Thailand
- Banpu Public Company Limited - Thailand
- Africa Commodities Group - South Africa
- Economic Council, Georgia
- San Jose City I Power Corp, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Wilmar Investment Holdings
- Coastal Gujarat Power Limited - India
- Sarangani Energy Corporation, Philippines
- Heidelberg Cement - Germany
- Kohat Cement Company Ltd. - Pakistan
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