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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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Sunday, 14 June 20
INDONESIAN COAL WAS STILL IN DEMAND; A 52,000-DWT SUPRAMAX FIXING DELIVERY CJK FOR A ROUND VOYAGE VIA INDONESIA AT $6,250 - BALTIC BRIEFING
Capesize
The Capesize market made new highs for the year this week after strong iron ore demand to the far east continued to develop in the mar ...
Friday, 12 June 20
CHINA CURBS COAL IMPORTS AFTER 5 MONTHS OF RECORD INFLOWS - SOURCES: REUTERS
China has stepped up customs checks for coal imports, leading to lengthy processing delays at ports, four sources familiar with the matter said, as ...
Friday, 12 June 20
COAL INDIA LIMITED SET FOR MARKETING DRIVE TO CREATE DEMAND - FINANCIAL EXPRESS
State-run miner Coal India (CIL), which is primarily focused on supplying coal to the power sector, is now reorienting its marketing to create dema ...
Friday, 12 June 20
MOODY'S REVISES BRENT OIL PRICE OUTLOOK TO $35/BARREL IN 2020 - TASS
Low oil prices are likely to exert the highest pressure on Iraq, Oman and Kuwait due to the limited space for the fiscal policy pursuit and higher ...
Thursday, 11 June 20
JAN-MAY, INDONESIA SHIPPED 175.15 MILLION TONS OF COAL TO ITS OVERSEAS BUYERS
Indonesia's coal production for the first 5 months of this year have reached 228 million tons. January – May 2020, Indonesia shipped US$ ...
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- Directorate Of Revenue Intelligence - India
- New Zealand Coal & Carbon
- Madhucon Powers Ltd - India
- Xindia Steels Limited - India
- IHS Mccloskey Coal Group - USA
- Petron Corporation, Philippines
- The University of Queensland
- Energy Development Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- ICICI Bank Limited - India
- Wilmar Investment Holdings
- Energy Link Ltd, New Zealand
- Georgia Ports Authority, United States
- Jaiprakash Power Ventures ltd
- Karaikal Port Pvt Ltd - India
- Siam City Cement PLC, Thailand
- IEA Clean Coal Centre - UK
- Borneo Indobara - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bhushan Steel Limited - India
- Planning Commission, India
- Bayan Resources Tbk. - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Latin American Coal - Colombia
- San Jose City I Power Corp, Philippines
- London Commodity Brokers - England
- Aboitiz Power Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Leighton Contractors Pty Ltd - Australia
- TeaM Sual Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Mjunction Services Limited - India
- Carbofer General Trading SA - India
- Ceylon Electricity Board - Sri Lanka
- Iligan Light & Power Inc, Philippines
- LBH Netherlands Bv - Netherlands
- Mercuria Energy - Indonesia
- Trasteel International SA, Italy
- Rashtriya Ispat Nigam Limited - India
- Deloitte Consulting - India
- International Coal Ventures Pvt Ltd - India
- Mintek Dendrill Indonesia
- Toyota Tsusho Corporation, Japan
- Vijayanagar Sugar Pvt Ltd - India
- SMG Consultants - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Larsen & Toubro Limited - India
- Star Paper Mills Limited - India
- Dalmia Cement Bharat India
- India Bulls Power Limited - India
- Ministry of Mines - Canada
- Sarangani Energy Corporation, Philippines
- Bangladesh Power Developement Board
- Power Finance Corporation Ltd., India
- Asmin Koalindo Tuhup - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bhoruka Overseas - Indonesia
- Semirara Mining Corp, Philippines
- Sree Jayajothi Cements Limited - India
- PowerSource Philippines DevCo
- Price Waterhouse Coopers - Russia
- Semirara Mining and Power Corporation, Philippines
- Indika Energy - Indonesia
- Indogreen Group - Indonesia
- Medco Energi Mining Internasional
- Australian Commodity Traders Exchange
- Kalimantan Lumbung Energi - Indonesia
- Kobexindo Tractors - Indoneisa
- Essar Steel Hazira Ltd - India
- Therma Luzon, Inc, Philippines
- White Energy Company Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- Globalindo Alam Lestari - Indonesia
- Samtan Co., Ltd - South Korea
- ASAPP Information Group - India
- Siam City Cement - Thailand
- Kaltim Prima Coal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Tamil Nadu electricity Board
- Alfred C Toepfer International GmbH - Germany
- Gujarat Sidhee Cement - India
- Commonwealth Bank - Australia
- Sical Logistics Limited - India
- Indonesian Coal Mining Association
- Holcim Trading Pte Ltd - Singapore
- SMC Global Power, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Metalloyd Limited - United Kingdom
- Eastern Energy - Thailand
- Malabar Cements Ltd - India
- Ambuja Cements Ltd - India
- Gujarat Electricity Regulatory Commission - India
- VISA Power Limited - India
- Orica Mining Services - Indonesia
- Chamber of Mines of South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- Mercator Lines Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jindal Steel & Power Ltd - India
- Sojitz Corporation - Japan
- Timah Investasi Mineral - Indoneisa
- Marubeni Corporation - India
- Coastal Gujarat Power Limited - India
- Australian Coal Association
- Eastern Coal Council - USA
- Ministry of Finance - Indonesia
- Vedanta Resources Plc - India
- Wood Mackenzie - Singapore
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Formosa Plastics Group - Taiwan
- Meenaskhi Energy Private Limited - India
- Riau Bara Harum - Indonesia
- Indo Tambangraya Megah - Indonesia
- Coalindo Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Oldendorff Carriers - Singapore
- Ministry of Transport, Egypt
- Thiess Contractors Indonesia
- Antam Resourcindo - Indonesia
- Salva Resources Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Renaissance Capital - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Indian Oil Corporation Limited
- European Bulk Services B.V. - Netherlands
- Directorate General of MIneral and Coal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Port Waratah Coal Services - Australia
- Central Java Power - Indonesia
- Sakthi Sugars Limited - India
- Sindya Power Generating Company Private Ltd
- McConnell Dowell - Australia
- Goldman Sachs - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bharathi Cement Corporation - India
- Heidelberg Cement - Germany
- Maheswari Brothers Coal Limited - India
- Edison Trading Spa - Italy
- Makarim & Taira - Indonesia
- Lanco Infratech Ltd - India
- Baramulti Group, Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The Treasury - Australian Government
- MS Steel International - UAE
- Intertek Mineral Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- CIMB Investment Bank - Malaysia
- Kepco SPC Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Tata Chemicals Ltd - India
- Meralco Power Generation, Philippines
- Standard Chartered Bank - UAE
- Kartika Selabumi Mining - Indonesia
- GAC Shipping (India) Pvt Ltd
- Parliament of New Zealand
- Grasim Industreis Ltd - India
- Economic Council, Georgia
- Africa Commodities Group - South Africa
- Binh Thuan Hamico - Vietnam
- Bukit Asam (Persero) Tbk - Indonesia
- GMR Energy Limited - India
- Electricity Generating Authority of Thailand
- Singapore Mercantile Exchange
- Karbindo Abesyapradhi - Indoneisa
- Videocon Industries ltd - India
- The State Trading Corporation of India Ltd
- Interocean Group of Companies - India
- Cement Manufacturers Association - India
- Independent Power Producers Association of India
- Maharashtra Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- GVK Power & Infra Limited - India
- Pendopo Energi Batubara - Indonesia
- Vizag Seaport Private Limited - India
- Anglo American - United Kingdom
- Bukit Makmur.PT - Indonesia
- Thai Mozambique Logistica
- Kapuas Tunggal Persada - Indonesia
- Kideco Jaya Agung - Indonesia
- Bhatia International Limited - India
- Bukit Baiduri Energy - Indonesia
- Attock Cement Pakistan Limited
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PetroVietnam Power Coal Import and Supply Company
- Orica Australia Pty. Ltd.
- Ind-Barath Power Infra Limited - India
- Central Electricity Authority - India
- Global Business Power Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Barasentosa Lestari - Indonesia
- PTC India Limited - India
- Romanian Commodities Exchange
- Coal and Oil Company - UAE
- Minerals Council of Australia
- Global Coal Blending Company Limited - Australia
- Altura Mining Limited, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Electricity Authority, New Zealand
- Gujarat Mineral Development Corp Ltd - India
- Parry Sugars Refinery, India
- Bulk Trading Sa - Switzerland
- Agrawal Coal Company - India
- CNBM International Corporation - China
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Aditya Birla Group - India
- Savvy Resources Ltd - HongKong
- Kumho Petrochemical, South Korea
- Rio Tinto Coal - Australia
- Jorong Barutama Greston.PT - Indonesia
- Straits Asia Resources Limited - Singapore
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