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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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Saturday, 05 September 20
INDIA WON'T KICK ITS COAL HABIT SO EASILY - HINDU BUSINESS LINE
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Saturday, 05 September 20
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Saturday, 05 September 20
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Saturday, 05 September 20
PAKISTAN'S NEW 27-YEAR POWER PLAN RISKS LOCKING IN LONG-TERM OVERCAPACITY, LEAVING IMPORTED COAL AND LNG PLANTS STRANDED - IEEFA
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Friday, 04 September 20
IN A DEEPENING DEBT HOLE OF $34 BILLION, INDONESIA’S PLN MUST STOP DIGGING - IEEFA
The utility has added IDR100 trillion in debt annually for the last five years
Utilities globally started changing the way they do business ye ...
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- Indian Oil Corporation Limited
- Oldendorff Carriers - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Edison Trading Spa - Italy
- Kideco Jaya Agung - Indonesia
- Posco Energy - South Korea
- The Treasury - Australian Government
- Latin American Coal - Colombia
- Holcim Trading Pte Ltd - Singapore
- ICICI Bank Limited - India
- Uttam Galva Steels Limited - India
- Minerals Council of Australia
- Kapuas Tunggal Persada - Indonesia
- Essar Steel Hazira Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- London Commodity Brokers - England
- Planning Commission, India
- Iligan Light & Power Inc, Philippines
- Electricity Authority, New Zealand
- Vedanta Resources Plc - India
- PNOC Exploration Corporation - Philippines
- Bangladesh Power Developement Board
- MS Steel International - UAE
- International Coal Ventures Pvt Ltd - India
- Coal and Oil Company - UAE
- Energy Development Corp, Philippines
- Ambuja Cements Ltd - India
- Chamber of Mines of South Africa
- Bhatia International Limited - India
- Kepco SPC Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Bukit Baiduri Energy - Indonesia
- Tamil Nadu electricity Board
- Bhoruka Overseas - Indonesia
- Kobexindo Tractors - Indoneisa
- Mercator Lines Limited - India
- Africa Commodities Group - South Africa
- Indogreen Group - Indonesia
- Renaissance Capital - South Africa
- Samtan Co., Ltd - South Korea
- Ministry of Finance - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kumho Petrochemical, South Korea
- Marubeni Corporation - India
- GMR Energy Limited - India
- Merrill Lynch Commodities Europe
- Anglo American - United Kingdom
- Grasim Industreis Ltd - India
- White Energy Company Limited
- Coastal Gujarat Power Limited - India
- Bukit Makmur.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- Vizag Seaport Private Limited - India
- LBH Netherlands Bv - Netherlands
- Salva Resources Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Sical Logistics Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Globalindo Alam Lestari - Indonesia
- Thiess Contractors Indonesia
- Petron Corporation, Philippines
- Carbofer General Trading SA - India
- Cement Manufacturers Association - India
- Indo Tambangraya Megah - Indonesia
- Mintek Dendrill Indonesia
- OPG Power Generation Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dalmia Cement Bharat India
- Coalindo Energy - Indonesia
- Maheswari Brothers Coal Limited - India
- Global Business Power Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Rio Tinto Coal - Australia
- Timah Investasi Mineral - Indoneisa
- Parliament of New Zealand
- Videocon Industries ltd - India
- Trasteel International SA, Italy
- Baramulti Group, Indonesia
- Metalloyd Limited - United Kingdom
- Economic Council, Georgia
- SMC Global Power, Philippines
- Banpu Public Company Limited - Thailand
- Indian Energy Exchange, India
- Attock Cement Pakistan Limited
- Ministry of Mines - Canada
- Interocean Group of Companies - India
- Medco Energi Mining Internasional
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Jindal Steel & Power Ltd - India
- San Jose City I Power Corp, Philippines
- Port Waratah Coal Services - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- PowerSource Philippines DevCo
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ceylon Electricity Board - Sri Lanka
- South Luzon Thermal Energy Corporation
- Jaiprakash Power Ventures ltd
- VISA Power Limited - India
- The University of Queensland
- Bhushan Steel Limited - India
- Global Coal Blending Company Limited - Australia
- IEA Clean Coal Centre - UK
- Star Paper Mills Limited - India
- New Zealand Coal & Carbon
- European Bulk Services B.V. - Netherlands
- Makarim & Taira - Indonesia
- Straits Asia Resources Limited - Singapore
- ASAPP Information Group - India
- Xindia Steels Limited - India
- Malabar Cements Ltd - India
- Eastern Energy - Thailand
- Orica Australia Pty. Ltd.
- Indonesian Coal Mining Association
- Binh Thuan Hamico - Vietnam
- Indika Energy - Indonesia
- Agrawal Coal Company - India
- Kaltim Prima Coal - Indonesia
- Sree Jayajothi Cements Limited - India
- Bulk Trading Sa - Switzerland
- PetroVietnam Power Coal Import and Supply Company
- Altura Mining Limited, Indonesia
- GAC Shipping (India) Pvt Ltd
- Kalimantan Lumbung Energi - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Ind-Barath Power Infra Limited - India
- Leighton Contractors Pty Ltd - Australia
- Global Green Power PLC Corporation, Philippines
- Tata Chemicals Ltd - India
- Central Java Power - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Gujarat Electricity Regulatory Commission - India
- CIMB Investment Bank - Malaysia
- Riau Bara Harum - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- Formosa Plastics Group - Taiwan
- India Bulls Power Limited - India
- Standard Chartered Bank - UAE
- Heidelberg Cement - Germany
- Bayan Resources Tbk. - Indonesia
- GVK Power & Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Georgia Ports Authority, United States
- Savvy Resources Ltd - HongKong
- Central Electricity Authority - India
- SN Aboitiz Power Inc, Philippines
- Thai Mozambique Logistica
- Meenaskhi Energy Private Limited - India
- Mjunction Services Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wood Mackenzie - Singapore
- Karaikal Port Pvt Ltd - India
- Borneo Indobara - Indonesia
- Parry Sugars Refinery, India
- Bukit Asam (Persero) Tbk - Indonesia
- IHS Mccloskey Coal Group - USA
- Gujarat Mineral Development Corp Ltd - India
- Mercuria Energy - Indonesia
- Lanco Infratech Ltd - India
- Price Waterhouse Coopers - Russia
- Madhucon Powers Ltd - India
- Energy Link Ltd, New Zealand
- Pendopo Energi Batubara - Indonesia
- Romanian Commodities Exchange
- Aboitiz Power Corporation - Philippines
- Siam City Cement - Thailand
- Wilmar Investment Holdings
- Aditya Birla Group - India
- CNBM International Corporation - China
- Manunggal Multi Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Semirara Mining and Power Corporation, Philippines
- Meralco Power Generation, Philippines
- Goldman Sachs - Singapore
- Chettinad Cement Corporation Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Bharathi Cement Corporation - India
- Sarangani Energy Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- AsiaOL BioFuels Corp., Philippines
- Eastern Coal Council - USA
- Semirara Mining Corp, Philippines
- Power Finance Corporation Ltd., India
- Kartika Selabumi Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- GN Power Mariveles Coal Plant, Philippines
- Sojitz Corporation - Japan
- Miang Besar Coal Terminal - Indonesia
- Larsen & Toubro Limited - India
- Commonwealth Bank - Australia
- Orica Mining Services - Indonesia
- Deloitte Consulting - India
- Neyveli Lignite Corporation Ltd, - India
- Sakthi Sugars Limited - India
- SMG Consultants - Indonesia
- Simpson Spence & Young - Indonesia
- Intertek Mineral Services - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Barasentosa Lestari - Indonesia
- Independent Power Producers Association of India
- Australian Commodity Traders Exchange
- Ministry of Transport, Egypt
- TeaM Sual Corporation - Philippines
- Australian Coal Association
- Directorate General of MIneral and Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- McConnell Dowell - Australia
- Singapore Mercantile Exchange
- Gujarat Sidhee Cement - India
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