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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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Thursday, 24 September 20
SUPRAMAX: INDO TO INDIA FIXING AROUND US$13,000 - FEARNLEYS
Cape
Over the last week the iron ore segment from Brazil to China has picked up, and we see freight rates up USD 2 (12%) week on week Fearnleys ...
Thursday, 24 September 20
KOREA MIDLAND POWER TO BUY 1.92 MILLION TONS OF 4,300-4,700 NCV COAL FOR THREE YEARS
COALspot.com: Korea Midland Power Co. Ltd, has issued an International tender for 640,000 MT 4,300-4,700 kcal/kg NCV coal per year.
...
Wednesday, 23 September 20
VIETNAM'S NEW POWER DEVELOPMENT PLAN MUST OPTIMIZE RENEWABLES AND AVOID FOSSIL FUEL LOCK-IN: IEEFA
EVN’s financial constraints leaves the utility with little room for error
Implementing Vietnam’s soon-to-be-launched next Power De ...
Wednesday, 23 September 20
MARKET INSIGHT - INTERMODAL
Undoubtedly, this year (ongoing) will never be forgotten because in a matter of months it has managed to severely affect and shape our day to day p ...
Friday, 18 September 20
INDIA'S COAL-FIRED POWER OUTPUT PICKS UP AS INDUSTRIAL USE RISES - REUTERS
India’s coal-fired electricity generation rose 9.4% in the first half of September, provisional government data showed, as demand from indust ...
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- Dalmia Cement Bharat India
- AsiaOL BioFuels Corp., Philippines
- Chamber of Mines of South Africa
- Petron Corporation, Philippines
- Meralco Power Generation, Philippines
- Minerals Council of Australia
- Sarangani Energy Corporation, Philippines
- Makarim & Taira - Indonesia
- Borneo Indobara - Indonesia
- Antam Resourcindo - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Planning Commission, India
- Bangladesh Power Developement Board
- GAC Shipping (India) Pvt Ltd
- Neyveli Lignite Corporation Ltd, - India
- Intertek Mineral Services - Indonesia
- Videocon Industries ltd - India
- Siam City Cement PLC, Thailand
- Mercator Lines Limited - India
- Riau Bara Harum - Indonesia
- Electricity Authority, New Zealand
- Commonwealth Bank - Australia
- Pendopo Energi Batubara - Indonesia
- Bulk Trading Sa - Switzerland
- White Energy Company Limited
- Miang Besar Coal Terminal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Kartika Selabumi Mining - Indonesia
- Bhushan Steel Limited - India
- Semirara Mining and Power Corporation, Philippines
- Deloitte Consulting - India
- South Luzon Thermal Energy Corporation
- PTC India Limited - India
- Orica Australia Pty. Ltd.
- London Commodity Brokers - England
- Standard Chartered Bank - UAE
- Interocean Group of Companies - India
- Kalimantan Lumbung Energi - Indonesia
- Trasteel International SA, Italy
- Uttam Galva Steels Limited - India
- Indonesian Coal Mining Association
- Straits Asia Resources Limited - Singapore
- Barasentosa Lestari - Indonesia
- Central Java Power - Indonesia
- Indogreen Group - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Banpu Public Company Limited - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Singapore Mercantile Exchange
- Indo Tambangraya Megah - Indonesia
- Marubeni Corporation - India
- European Bulk Services B.V. - Netherlands
- PetroVietnam Power Coal Import and Supply Company
- CNBM International Corporation - China
- Goldman Sachs - Singapore
- Indika Energy - Indonesia
- Gujarat Sidhee Cement - India
- Xindia Steels Limited - India
- Rio Tinto Coal - Australia
- Ceylon Electricity Board - Sri Lanka
- Indian Energy Exchange, India
- The University of Queensland
- Energy Link Ltd, New Zealand
- Bayan Resources Tbk. - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Bukit Makmur.PT - Indonesia
- Indian Oil Corporation Limited
- Aditya Birla Group - India
- CIMB Investment Bank - Malaysia
- Coastal Gujarat Power Limited - India
- Simpson Spence & Young - Indonesia
- Merrill Lynch Commodities Europe
- Oldendorff Carriers - Singapore
- Coalindo Energy - Indonesia
- Australian Commodity Traders Exchange
- Attock Cement Pakistan Limited
- Africa Commodities Group - South Africa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sojitz Corporation - Japan
- Renaissance Capital - South Africa
- Iligan Light & Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Salva Resources Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Kapuas Tunggal Persada - Indonesia
- IHS Mccloskey Coal Group - USA
- Australian Coal Association
- Price Waterhouse Coopers - Russia
- Ministry of Mines - Canada
- Holcim Trading Pte Ltd - Singapore
- Timah Investasi Mineral - Indoneisa
- The State Trading Corporation of India Ltd
- ASAPP Information Group - India
- OPG Power Generation Pvt Ltd - India
- Tamil Nadu electricity Board
- International Coal Ventures Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Coal and Oil Company - UAE
- Global Coal Blending Company Limited - Australia
- Eastern Coal Council - USA
- TNB Fuel Sdn Bhd - Malaysia
- Central Electricity Authority - India
- Larsen & Toubro Limited - India
- Bhatia International Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Posco Energy - South Korea
- Latin American Coal - Colombia
- Mercuria Energy - Indonesia
- Jaiprakash Power Ventures ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining Corp, Philippines
- Vedanta Resources Plc - India
- Bhoruka Overseas - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Vizag Seaport Private Limited - India
- Manunggal Multi Energi - Indonesia
- New Zealand Coal & Carbon
- Thiess Contractors Indonesia
- Kepco SPC Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- McConnell Dowell - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- LBH Netherlands Bv - Netherlands
- Mintek Dendrill Indonesia
- MS Steel International - UAE
- Sindya Power Generating Company Private Ltd
- Romanian Commodities Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- PowerSource Philippines DevCo
- Edison Trading Spa - Italy
- Karbindo Abesyapradhi - Indoneisa
- San Jose City I Power Corp, Philippines
- Eastern Energy - Thailand
- Baramulti Group, Indonesia
- Medco Energi Mining Internasional
- Grasim Industreis Ltd - India
- Globalindo Alam Lestari - Indonesia
- Lanco Infratech Ltd - India
- Kumho Petrochemical, South Korea
- Directorate General of MIneral and Coal - Indonesia
- IEA Clean Coal Centre - UK
- Global Business Power Corporation, Philippines
- Parry Sugars Refinery, India
- Cigading International Bulk Terminal - Indonesia
- Altura Mining Limited, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Bharathi Cement Corporation - India
- Toyota Tsusho Corporation, Japan
- Maharashtra Electricity Regulatory Commission - India
- Anglo American - United Kingdom
- Jorong Barutama Greston.PT - Indonesia
- India Bulls Power Limited - India
- Binh Thuan Hamico - Vietnam
- Power Finance Corporation Ltd., India
- Directorate Of Revenue Intelligence - India
- Thai Mozambique Logistica
- Aboitiz Power Corporation - Philippines
- GVK Power & Infra Limited - India
- Malabar Cements Ltd - India
- Wood Mackenzie - Singapore
- Georgia Ports Authority, United States
- Star Paper Mills Limited - India
- The Treasury - Australian Government
- Therma Luzon, Inc, Philippines
- VISA Power Limited - India
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- Formosa Plastics Group - Taiwan
- Cement Manufacturers Association - India
- PNOC Exploration Corporation - Philippines
- Ind-Barath Power Infra Limited - India
- Independent Power Producers Association of India
- Mjunction Services Limited - India
- Ministry of Finance - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Agrawal Coal Company - India
- Kideco Jaya Agung - Indonesia
- Maheswari Brothers Coal Limited - India
- SMC Global Power, Philippines
- Metalloyd Limited - United Kingdom
- Heidelberg Cement - Germany
- Electricity Generating Authority of Thailand
- Ministry of Transport, Egypt
- Wilmar Investment Holdings
- Sree Jayajothi Cements Limited - India
- Madhucon Powers Ltd - India
- ICICI Bank Limited - India
- TeaM Sual Corporation - Philippines
- Kobexindo Tractors - Indoneisa
- Savvy Resources Ltd - HongKong
- Orica Mining Services - Indonesia
- SMG Consultants - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Carbofer General Trading SA - India
- Ambuja Cements Ltd - India
- Sakthi Sugars Limited - India
- GMR Energy Limited - India
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Parliament of New Zealand
- Sical Logistics Limited - India
- Economic Council, Georgia
- Port Waratah Coal Services - Australia
- Essar Steel Hazira Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Jindal Steel & Power Ltd - India
- Karaikal Port Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Chettinad Cement Corporation Ltd - India
- Kaltim Prima Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Petrochimia International Co. Ltd.- Taiwan
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