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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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- Bukit Asam (Persero) Tbk - Indonesia
- Australian Coal Association
- Singapore Mercantile Exchange
- Bhushan Steel Limited - India
- IHS Mccloskey Coal Group - USA
- The Treasury - Australian Government
- Ambuja Cements Ltd - India
- Jindal Steel & Power Ltd - India
- Bharathi Cement Corporation - India
- Thai Mozambique Logistica
- Wood Mackenzie - Singapore
- CIMB Investment Bank - Malaysia
- Chamber of Mines of South Africa
- International Coal Ventures Pvt Ltd - India
- Independent Power Producers Association of India
- Kartika Selabumi Mining - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Makarim & Taira - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- ASAPP Information Group - India
- Trasteel International SA, Italy
- GN Power Mariveles Coal Plant, Philippines
- Indo Tambangraya Megah - Indonesia
- Mjunction Services Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Edison Trading Spa - Italy
- Energy Link Ltd, New Zealand
- Sarangani Energy Corporation, Philippines
- Electricity Authority, New Zealand
- Kepco SPC Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Gujarat Sidhee Cement - India
- Petron Corporation, Philippines
- Grasim Industreis Ltd - India
- Coal and Oil Company - UAE
- Mercator Lines Limited - India
- Siam City Cement PLC, Thailand
- Bhoruka Overseas - Indonesia
- Intertek Mineral Services - Indonesia
- Anglo American - United Kingdom
- Karbindo Abesyapradhi - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- New Zealand Coal & Carbon
- PNOC Exploration Corporation - Philippines
- Romanian Commodities Exchange
- Chettinad Cement Corporation Ltd - India
- Bukit Makmur.PT - Indonesia
- Xindia Steels Limited - India
- Rio Tinto Coal - Australia
- Indika Energy - Indonesia
- Energy Development Corp, Philippines
- Indian Oil Corporation Limited
- Kapuas Tunggal Persada - Indonesia
- Thiess Contractors Indonesia
- Coastal Gujarat Power Limited - India
- Ind-Barath Power Infra Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Transport, Egypt
- Formosa Plastics Group - Taiwan
- Sojitz Corporation - Japan
- Parliament of New Zealand
- Larsen & Toubro Limited - India
- Banpu Public Company Limited - Thailand
- Bukit Baiduri Energy - Indonesia
- Straits Asia Resources Limited - Singapore
- Marubeni Corporation - India
- OPG Power Generation Pvt Ltd - India
- Sical Logistics Limited - India
- Agrawal Coal Company - India
- Latin American Coal - Colombia
- Krishnapatnam Port Company Ltd. - India
- Maharashtra Electricity Regulatory Commission - India
- Sakthi Sugars Limited - India
- Iligan Light & Power Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Global Green Power PLC Corporation, Philippines
- Ministry of Mines - Canada
- South Luzon Thermal Energy Corporation
- Oldendorff Carriers - Singapore
- Renaissance Capital - South Africa
- SMC Global Power, Philippines
- Central Electricity Authority - India
- Sinarmas Energy and Mining - Indonesia
- Power Finance Corporation Ltd., India
- Heidelberg Cement - Germany
- Deloitte Consulting - India
- Directorate Of Revenue Intelligence - India
- GMR Energy Limited - India
- Aditya Birla Group - India
- Kaltim Prima Coal - Indonesia
- Altura Mining Limited, Indonesia
- Videocon Industries ltd - India
- Timah Investasi Mineral - Indoneisa
- India Bulls Power Limited - India
- Australian Commodity Traders Exchange
- Jaiprakash Power Ventures ltd
- Mercuria Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Port Waratah Coal Services - Australia
- Sree Jayajothi Cements Limited - India
- Semirara Mining Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Tamil Nadu electricity Board
- Maheswari Brothers Coal Limited - India
- The University of Queensland
- GVK Power & Infra Limited - India
- Medco Energi Mining Internasional
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sindya Power Generating Company Private Ltd
- IEA Clean Coal Centre - UK
- PTC India Limited - India
- Commonwealth Bank - Australia
- Eastern Coal Council - USA
- Billiton Holdings Pty Ltd - Australia
- Savvy Resources Ltd - HongKong
- Alfred C Toepfer International GmbH - Germany
- Cigading International Bulk Terminal - Indonesia
- CNBM International Corporation - China
- ICICI Bank Limited - India
- Baramulti Group, Indonesia
- Therma Luzon, Inc, Philippines
- Price Waterhouse Coopers - Russia
- Coalindo Energy - Indonesia
- Orica Australia Pty. Ltd.
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- Bayan Resources Tbk. - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vizag Seaport Private Limited - India
- Rashtriya Ispat Nigam Limited - India
- AsiaOL BioFuels Corp., Philippines
- Kobexindo Tractors - Indoneisa
- Global Business Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Interocean Group of Companies - India
- San Jose City I Power Corp, Philippines
- Binh Thuan Hamico - Vietnam
- Indogreen Group - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhatia International Limited - India
- Salva Resources Pvt Ltd - India
- Indian Energy Exchange, India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Merrill Lynch Commodities Europe
- The State Trading Corporation of India Ltd
- Essar Steel Hazira Ltd - India
- Planning Commission, India
- Riau Bara Harum - Indonesia
- TeaM Sual Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kideco Jaya Agung - Indonesia
- GAC Shipping (India) Pvt Ltd
- Parry Sugars Refinery, India
- Goldman Sachs - Singapore
- Cement Manufacturers Association - India
- Bulk Trading Sa - Switzerland
- Leighton Contractors Pty Ltd - Australia
- Meralco Power Generation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Eastern Energy - Thailand
- Meenaskhi Energy Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Attock Cement Pakistan Limited
- Manunggal Multi Energi - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Tata Chemicals Ltd - India
- Samtan Co., Ltd - South Korea
- VISA Power Limited - India
- Standard Chartered Bank - UAE
- London Commodity Brokers - England
- Ministry of Finance - Indonesia
- Antam Resourcindo - Indonesia
- Vedanta Resources Plc - India
- Simpson Spence & Young - Indonesia
- Posco Energy - South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Economic Council, Georgia
- Malabar Cements Ltd - India
- Wilmar Investment Holdings
- PowerSource Philippines DevCo
- White Energy Company Limited
- Uttam Galva Steels Limited - India
- McConnell Dowell - Australia
- Georgia Ports Authority, United States
- Metalloyd Limited - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- Minerals Council of Australia
- Directorate General of MIneral and Coal - Indonesia
- Indonesian Coal Mining Association
- MS Steel International - UAE
- Lanco Infratech Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Barasentosa Lestari - Indonesia
- Central Java Power - Indonesia
- Africa Commodities Group - South Africa
- Toyota Tsusho Corporation, Japan
- Bahari Cakrawala Sebuku - Indonesia
- Star Paper Mills Limited - India
- LBH Netherlands Bv - Netherlands
- Dalmia Cement Bharat India
- SMG Consultants - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Orica Mining Services - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Kumho Petrochemical, South Korea
- Global Coal Blending Company Limited - Australia
- Kohat Cement Company Ltd. - Pakistan
- Bangladesh Power Developement Board
- Aboitiz Power Corporation - Philippines
- Mintek Dendrill Indonesia
- Electricity Generating Authority of Thailand
- Siam City Cement - Thailand
- Karaikal Port Pvt Ltd - India
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