Tue Jan 24, 2012
* Vale lifts force majeure on Brazilian shipments
* India's NMDC resumes supply from major mines
* Global steel output growth slows in 2011
SINGAPORE, Jan 24 (Reuters) - Iron ore steadied with trading activity nearly halted as top market China remained shut on Tuesday for the Lunar New Year holiday, blunting any impact from miner Vale's decision to lift a force majeure on Brazilian shipments.
Vale, the world's No. 1 iron ore producer, said on Monday it has resumed mining and export operations after rains eased in southeastern Brazil.
Vale earlier this month declared force majeure on iron ore shipments from Brazil, a legal clause that allows a company to break contractual obligations, because of heavy rains that cut its output by around 2 million tonnes.
Iron ore with 62 percent iron content .IO62-CNI=SI was unchanged at $139.80 a tonne on Monday, according to Steel Index.
There are hardly any deals in the spot market with the Chinese away for the holiday and chances are prices may slip marginally, said Dhruv Goel, managing director at iron ore trading firm SteelMint in India's eastern Orissa state.
But Goel said Chinese demand for lower grade Indian iron ore has improved recently and he expects it to continue after the holiday.
"Chinese buyers are interested in buying low grade from India, as cargoes from Australia and Brazil are generally high grade," he said.
India's biggest iron ore miner, NMDC Ltd, has resumed operations in the central state of Chhattisgarh, which accounts for two-thirds of its annual ouput of 25 million tonnes, after protests disrupted railway movements for 10 days.
Local protests had forced NMDC to halt production and exports of iron ore from the mines. The protest was called off after the federal government agreed to improve the overall rail network in the Bastar region, a predominently tribal area that has roughly a fifth of India's iron ore deposits.
Reflecting a slump in Chinese buying, the Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, fell to its lowest in more than three years on Monday.
Expected slower growth in China's steel production this year could similarly curb its demand for raw material iron ore.
China's crude steel output rose 8.9 percent to around 683 million tonnes in 2011, versus a 9.3 percent clip in 2010. A Reuters poll in mid-December showed the country's steel output may reach 728 million tonnes this year, 6.5 percent higher than 2011.
Globally, steel production rose 6.8 percent to 1.527 billion tonnes in 2011, less than half the 15 percent increase in 2010, data from the World Steel Association showed on Monday.
(sourced Reuters)
Showing posts with label Baltic Exchange. Show all posts
Showing posts with label Baltic Exchange. Show all posts
Tuesday, January 24, 2012
Wednesday, January 11, 2012
Iron ore shipping costs plunge 47pct amid China slowdown risks
Wednesday, 11 Jan 2012
Bloomberg reported that the cost of hauling iron ore and coal fell to a four-month low, extending this year decline to 47% amid concerns a Chinese economic slowdown will curb steel production, the biggest driver of global shipping demand.
According to the London based Baltic Exchange rates to hire a capesize ship, the largest in the fleet of dry-bulk vessels dropped 6.1% to USD 14,535 a day. That’s less than half the 2011 high of USD 32,889 reached on December 12.
Ms Natasha Boyden an analyst at New York-based Cantor Fitzgerald LP said “Concerns about a Chinese economic slowdown mean that there are real risks to weaker Chinese steel production growth in 2012 which the capesize sector is highly leveraged to.”
According to the exchange which publishes rates for more than 50 maritime routes the Baltic Dry Index a measure of charter costs for four classes of vessels declined 2.9% to 1,308 points. That the lowest level since August 15. The gauge has fallen 25% in 2012, as earnings for the other vessel types also declined while at a lower pace than capesizes.
Cantor Fitzgerald said a surge in new vessels being delivered from shipyards in January will entrench hire costs for the fleet of 1,335 capesize ships at current lows. Rainy weather in Australia and Brazil, the largest exporters of iron ore, also cut shipments amid falling demand ahead of the Chinese New Year shutdown later this month.
According to the most recent data from the World Steel Association China steel production has declined for six straight months falling to 49.8 million tonnes in November.
(Sourced from Bloomberg)
Bloomberg reported that the cost of hauling iron ore and coal fell to a four-month low, extending this year decline to 47% amid concerns a Chinese economic slowdown will curb steel production, the biggest driver of global shipping demand.
According to the London based Baltic Exchange rates to hire a capesize ship, the largest in the fleet of dry-bulk vessels dropped 6.1% to USD 14,535 a day. That’s less than half the 2011 high of USD 32,889 reached on December 12.
Ms Natasha Boyden an analyst at New York-based Cantor Fitzgerald LP said “Concerns about a Chinese economic slowdown mean that there are real risks to weaker Chinese steel production growth in 2012 which the capesize sector is highly leveraged to.”
According to the exchange which publishes rates for more than 50 maritime routes the Baltic Dry Index a measure of charter costs for four classes of vessels declined 2.9% to 1,308 points. That the lowest level since August 15. The gauge has fallen 25% in 2012, as earnings for the other vessel types also declined while at a lower pace than capesizes.
Cantor Fitzgerald said a surge in new vessels being delivered from shipyards in January will entrench hire costs for the fleet of 1,335 capesize ships at current lows. Rainy weather in Australia and Brazil, the largest exporters of iron ore, also cut shipments amid falling demand ahead of the Chinese New Year shutdown later this month.
According to the most recent data from the World Steel Association China steel production has declined for six straight months falling to 49.8 million tonnes in November.
(Sourced from Bloomberg)
Tuesday, December 27, 2011
Earnings of smallest bulkers fall to lowest in 33 months
Tuesday, 27 Dec 2011
It is reported that earnings from the world’s smallest commodity ships fell to the lowest level in almost three years as the vessels miss out on a boom in Chinese iron ore demand that buoyed rates for larger carriers.
According to the data from the Baltic Exchange in London Hire costs for Handysizes that haul at most 35,000 tonnes of cargo slid for a 22nd day declining USD 2 to USD 8,389 a day. The ships which move cargoes from grains to lumber are down 31% this year compared with a 57% rally in rates for Capesize carriers that are at least four times bigger and transport iron ore.
Mr Jeffrey Landsberg president of Commodore Research in New York said “China is taking a large amount of iron ore even though the world is still going through significant economic trouble. Handysizes are more susceptible to changes in the developed world.”
According to ship-tracking data compiled by Bloomberg for carriers signaling arrival dates within the next month that 10% of the global fleet of Handysizes is bound for the Asian country compared with 21% of Capesizes. Almost half of the Capesize fleet is sailing for China or for Australia or Brazil, the two largest iron ore exporters compared with 18% of Handysizes.
According to economists’ forecasts compiled by Bloomberg and data from Clarkson Research Services Ltd a unit of the world largest shipbroker China, growing more than three times faster than the global average will import 10% more of the ingredient used in steelmaking this year. While that bolsters demand for both Capesize and Handysizes vessels, the smaller ships have a wider cargo mix, meaning they benefit less.
(Sourced from www.mb.com.ph)
It is reported that earnings from the world’s smallest commodity ships fell to the lowest level in almost three years as the vessels miss out on a boom in Chinese iron ore demand that buoyed rates for larger carriers.
According to the data from the Baltic Exchange in London Hire costs for Handysizes that haul at most 35,000 tonnes of cargo slid for a 22nd day declining USD 2 to USD 8,389 a day. The ships which move cargoes from grains to lumber are down 31% this year compared with a 57% rally in rates for Capesize carriers that are at least four times bigger and transport iron ore.
Mr Jeffrey Landsberg president of Commodore Research in New York said “China is taking a large amount of iron ore even though the world is still going through significant economic trouble. Handysizes are more susceptible to changes in the developed world.”
According to ship-tracking data compiled by Bloomberg for carriers signaling arrival dates within the next month that 10% of the global fleet of Handysizes is bound for the Asian country compared with 21% of Capesizes. Almost half of the Capesize fleet is sailing for China or for Australia or Brazil, the two largest iron ore exporters compared with 18% of Handysizes.
According to economists’ forecasts compiled by Bloomberg and data from Clarkson Research Services Ltd a unit of the world largest shipbroker China, growing more than three times faster than the global average will import 10% more of the ingredient used in steelmaking this year. While that bolsters demand for both Capesize and Handysizes vessels, the smaller ships have a wider cargo mix, meaning they benefit less.
(Sourced from www.mb.com.ph)
Monday, December 12, 2011
Baltic index higher, capesizes at over 1-yr high
Monday, 12 December 2011
The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, rose for a third day on Friday helped by firm iron ore trade to China with earnings for the larger capesizes jumping to their highest in over a year.
Nevertheless, the shipping sector is expected to see more turmoil in coming months as a supply glut and growing economic gloom keep earnings under pressure with growing worries over the outlook for Chinese raw materials demand.
The overall index rose 40 points or 2.13 percent to 1,922 points.
"Despite the demand headwinds from muted steel production in China and slowing industrial production, the capesize segment has been remarkably resilient. Mix of factors including higher port congestion, recovery in coal exports from Australia and increasing Chinese iron ore imports from Brazil, aiding tonne mile have supported the segment," RS Platou Markets said.
"Declining steel output and slowing industrial production remains a key challenge going into 2012 for dry bulk demand and we still expect rates to see a gradual decline."
China's industrial output growth hit its slowest pace in more than two years in November and inflation tumbled as economic conditions deteriorated, raising expectations Beijing will ease monetary policy again.
Iron ore shipments account for around a third of seaborne volumes on the larger capesizes, and brokers said price developments remained a key factor for dry freight.
Shanghai rebar futures dropped for a second day on Friday, weighed down by a weak outlook for steel demand in top market China after fresh data suggested the Chinese economy was cooling off rapidly, although hopes of further monetary easing capped losses.
Capesizes, which typically transport 150,000 tonne cargoes such as iron ore and coal, had driven a recent rally, helped by firmer coal and iron ore exports from Australia and Brazil to China as well as a pick-up in Japanese coal imports. A build-up of port congestion also provided support.
The Baltic's capesize index rose 4.76 percent on Friday, with average daily earnings rising to $32,617 and at their highest since November 2010.
In August, the overall index, which gauges the cost of shipping commodities including iron ore, coal and grain, fell for 18 consecutive sessions and reached its lowest in more than three months. It has remained erratic and is still down over 12 percent from the same period last year.
The Baltic's panamax index rose 1.18 percent. Average daily earnings for panamaxes, which usually transport 60,000-70,000 tonne cargoes of coal or grains, reached $$13,682.
"In the Pacific, the Christmas holiday lull is biting further and business conditions have continued to slow, with much of owners' focus on securing sufficient employment duration to see their (panamax) vessels past the holiday period," broker Braemar Seascope said. "The outlook for the remainder of the year is still flat/negative."
Growing ship supply, which is outpacing commodity demand, is set to cap dry bulk freight rate gains in the coming months, with economic uncertainty and a slowdown in China adding to headwinds.
Daewoo Shipbuilding & Marine Engineering said on Friday it had lost an order from a European customer, including two dry bulk vessels, worth over half a billion dollars in a sign of worsening conditions in the seaborne sector and a growing euro zone lending squeeze.
Source: Reuters
Sunday, October 23, 2011
Capesize iron ore ship rents rise - Barclays
Sunday, 23 Oct 2011
Bloomberg reported that rents for Capesize vessels that haul iron ore rose as Barclays Capital said lower prices for the steelmaking raw material may spur demand for shipments to China.
According to the Baltic Exchange in London Daily rates gained 0.8% to USD 29,918 after dropping 5.3% from the 10 month high reached October 14. Capesizes are the biggest vessels tracked by the Baltic Dry Index a broader gauge of commodity- shipping rates which increased 0.2% to 2,140.
UBS AG said in a report dated October 13 Monthly iron ore shipments to China the top steelmaker globally will average 60 million tonnes from September through December. That would exceed the record 59 million tons imported in the first quarter of 2011.
Barclays analysts including Mr Miswin Mahesh in London said “We expect freight rates on routes carrying iron ore to China to maintain the current state of buoyancy for a few more weeks.”
Rents for capesizes on the Brazil-to-China iron-ore route gained 2.2% to the highest level since November.
sourced Bloomberg
Bloomberg reported that rents for Capesize vessels that haul iron ore rose as Barclays Capital said lower prices for the steelmaking raw material may spur demand for shipments to China.
According to the Baltic Exchange in London Daily rates gained 0.8% to USD 29,918 after dropping 5.3% from the 10 month high reached October 14. Capesizes are the biggest vessels tracked by the Baltic Dry Index a broader gauge of commodity- shipping rates which increased 0.2% to 2,140.
UBS AG said in a report dated October 13 Monthly iron ore shipments to China the top steelmaker globally will average 60 million tonnes from September through December. That would exceed the record 59 million tons imported in the first quarter of 2011.
Barclays analysts including Mr Miswin Mahesh in London said “We expect freight rates on routes carrying iron ore to China to maintain the current state of buoyancy for a few more weeks.”
Rents for capesizes on the Brazil-to-China iron-ore route gained 2.2% to the highest level since November.
sourced Bloomberg
Monday, February 28, 2011
Baltic index rises, capesize market seen pressured
Monday,28 February 2011
he Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, turned barely positive on Friday, although sentiment was expected to remain weak due to a glut of vessels.
The index rose 0.24 percent or 3 points to 1,245 points, after falling in the four previous sessions. That slump followed ten days of gains.
"The main drag on rates this week was a lull in Chinese iron ore fixtures due to record stockpiles," said Jeffrey Landsberg, managing director of dry bulk consultancy Commodore Research. "This affected capesize rates.
"Gains are certainly possible for the coming week," he said.
Earlier this month before the modest rally, the index, which tracks the cost of shipping key commodities such as iron ore, cement, grain, coal and fertiliser, reached its lowest in two years.
The Baltic's main index has remained erratic since 2009 because of swings in Chinese demand for iron ore, the primary ingredient of steel.
"Since the capesize debacle has begun, $4,500/day to $5,000/day has been the artificial level that owners have maintained as a floor for average capesize rates," Landsberg said.
"Despite capesize vessel supply exceeding demand, owners have resisted chartering out their capes when rates have reached current levels."
The Baltic's capesize index .BACI fell 0.3 percent, with average daily earnings dropping to $4,653 in an ninth session of falls. Capesizes typically haul 150,000 tonne cargoes such as iron ore and coal.
"Capes in all regions are apparently unable to shake off the problems presented by significant oversupply and activity remains too limited to provide any boost in rates," Braemar Seascope said.
The Baltic's panamax index .BPNI fell 0.06 percent, with average daily earnings dropping to $14,530, falling for a fifth day after 12 sessions of gains previously. Panamax vessels usually transport 60,000-70,000 tonne cargoes of coal or grains.
"Grain fixtures have been slow to emerge, with Chinese buyers remaining quiet," Braemar said.
Adding to economic headwinds in western industrialised countries, a major source of shipping demand, are inflationary fears in China, which could potentially lead to further interest rate rises and a pullback in demand for ore, delivering another setback for shippers.
China's consumer confidence index dropped in the fourth quarter, the second consecutive quarterly decline, as expectations for rising prices hurt sentiment. While there are indications of some vessel cancellations and delays, analysts expect deliveries to gather pace between 2011 and 2012.(source: Reuters)
The index rose 0.24 percent or 3 points to 1,245 points, after falling in the four previous sessions. That slump followed ten days of gains.
"The main drag on rates this week was a lull in Chinese iron ore fixtures due to record stockpiles," said Jeffrey Landsberg, managing director of dry bulk consultancy Commodore Research. "This affected capesize rates.
"Gains are certainly possible for the coming week," he said.
Earlier this month before the modest rally, the index, which tracks the cost of shipping key commodities such as iron ore, cement, grain, coal and fertiliser, reached its lowest in two years.
The Baltic's main index has remained erratic since 2009 because of swings in Chinese demand for iron ore, the primary ingredient of steel.
"Since the capesize debacle has begun, $4,500/day to $5,000/day has been the artificial level that owners have maintained as a floor for average capesize rates," Landsberg said.
"Despite capesize vessel supply exceeding demand, owners have resisted chartering out their capes when rates have reached current levels."
The Baltic's capesize index .BACI fell 0.3 percent, with average daily earnings dropping to $4,653 in an ninth session of falls. Capesizes typically haul 150,000 tonne cargoes such as iron ore and coal.
"Capes in all regions are apparently unable to shake off the problems presented by significant oversupply and activity remains too limited to provide any boost in rates," Braemar Seascope said.
The Baltic's panamax index .BPNI fell 0.06 percent, with average daily earnings dropping to $14,530, falling for a fifth day after 12 sessions of gains previously. Panamax vessels usually transport 60,000-70,000 tonne cargoes of coal or grains.
"Grain fixtures have been slow to emerge, with Chinese buyers remaining quiet," Braemar said.
Adding to economic headwinds in western industrialised countries, a major source of shipping demand, are inflationary fears in China, which could potentially lead to further interest rate rises and a pullback in demand for ore, delivering another setback for shippers.
China's consumer confidence index dropped in the fourth quarter, the second consecutive quarterly decline, as expectations for rising prices hurt sentiment. While there are indications of some vessel cancellations and delays, analysts expect deliveries to gather pace between 2011 and 2012.(source: Reuters)
Monday, February 7, 2011
Global freight rates poised to rise after tumbling to a 2 year low
Monday, 07 Feb 2011
Bloomberg reported that freight rates are poised to rise after tumbling to a two year low as owners of ships hauling coal and iron ore scrap the most vessels in at least 28 years.
According to Clarkson Plc, a total of 38 Capesize, will be demolished in 2011.
Charter costs should average USD 22,000 in 2011, almost four times today’s rate of USD 5,724.
Mr Philippe van den Abeele MD of Castalia Fund Management (UK) Limited said that "From where we are now I don't see much downside. People are depressed, they think it’s the end of the world in dry cargo shipping, but they’re pushing it too far."
A Bloomberg survey of eight fund managers and analysts last month showed that owners of older vessels may sell them for scrap because earnings from single voyage charters were slashed by a four week, 71% slump in rates. The most demolitions since Clarkson's records begin in 1983 may help reduce a glut as an estimated 200 new Capesize, spanning about 35 miles laid end to end, leave shipyards this year.
Mr Van den Abeele's forecast for this year's average rate is at least 22% higher than any of the quarterly forward freight agreements being traded for 2011. The accords, traded by brokers, allow investors to hedge or bet on the future cost of shipping.
According to the Baltic Exchange, companies ordered too many ships in 2007 and 2008, when daily income averaged about USD 111,000. Rates reached a record USD 233,988 in June 2008 before plunging 99% over the next six months to USD 2,316.
Korea Line Corporation, South Korea's second largest operator of dry bulk ships, filed for receivership last month after reporting losses in six of the past seven quarters. The 12 member Bloomberg Dry Ships Index fell 4.5% this year, extending an 8% drop in 2010, with the biggest declines for Genco Shipping & Trading Limited and Eagle Bulk Shipping Inc.
Mr Nigel Prentis director of research and consulting at HSBC Shipping Services Limited in London said that owners of capsizes valued at USD 60 million are paying about USD 25,000 a day in costs to cover expenses such as crew and financing. Single voyage rates have been below that level since December 20th 2010.
The Baltic Exchange reported its first ever negative rate for dry bulk freight on January 13th 2011. Costs on the C11 route for shipments to Europe from Asia are now at minus USD 2,227 a day. While that means owners pay customers to hire their vessels, clients still pay most of the fuel costs. For a shipping line wanting to relocate a vessel to a region where there are more cargoes, that’s still cheaper than sailing the craft empty.(sourced:bloomberg.net)
Bloomberg reported that freight rates are poised to rise after tumbling to a two year low as owners of ships hauling coal and iron ore scrap the most vessels in at least 28 years.
According to Clarkson Plc, a total of 38 Capesize, will be demolished in 2011.
Charter costs should average USD 22,000 in 2011, almost four times today’s rate of USD 5,724.
Mr Philippe van den Abeele MD of Castalia Fund Management (UK) Limited said that "From where we are now I don't see much downside. People are depressed, they think it’s the end of the world in dry cargo shipping, but they’re pushing it too far."
A Bloomberg survey of eight fund managers and analysts last month showed that owners of older vessels may sell them for scrap because earnings from single voyage charters were slashed by a four week, 71% slump in rates. The most demolitions since Clarkson's records begin in 1983 may help reduce a glut as an estimated 200 new Capesize, spanning about 35 miles laid end to end, leave shipyards this year.
Mr Van den Abeele's forecast for this year's average rate is at least 22% higher than any of the quarterly forward freight agreements being traded for 2011. The accords, traded by brokers, allow investors to hedge or bet on the future cost of shipping.
According to the Baltic Exchange, companies ordered too many ships in 2007 and 2008, when daily income averaged about USD 111,000. Rates reached a record USD 233,988 in June 2008 before plunging 99% over the next six months to USD 2,316.
Korea Line Corporation, South Korea's second largest operator of dry bulk ships, filed for receivership last month after reporting losses in six of the past seven quarters. The 12 member Bloomberg Dry Ships Index fell 4.5% this year, extending an 8% drop in 2010, with the biggest declines for Genco Shipping & Trading Limited and Eagle Bulk Shipping Inc.
Mr Nigel Prentis director of research and consulting at HSBC Shipping Services Limited in London said that owners of capsizes valued at USD 60 million are paying about USD 25,000 a day in costs to cover expenses such as crew and financing. Single voyage rates have been below that level since December 20th 2010.
The Baltic Exchange reported its first ever negative rate for dry bulk freight on January 13th 2011. Costs on the C11 route for shipments to Europe from Asia are now at minus USD 2,227 a day. While that means owners pay customers to hire their vessels, clients still pay most of the fuel costs. For a shipping line wanting to relocate a vessel to a region where there are more cargoes, that’s still cheaper than sailing the craft empty.(sourced:bloomberg.net)
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