the dry bulk markets’ lam... · source: baltic exchange, howe robinson research 0 3 6 9 12 1990...
TRANSCRIPT
All Aboard: The Dry Bulk Markets’
Changing Course
A Presentation to Global Grain Asia
by Janina Lam, Howe Robinson Shipbrokers
12th March 2014
source: Baltic Exchange, Howe Robinson Research
0
3
6
9
12
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
Ind
ex V
alu
e (
‘00
0)
BDI
BDI Annual Average
Baltic Dry Index 2002 – Today
0
50
100
150
200
250
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
‘00
0 U
S$
/ D
ay
TC Avg. BCITC Avg. BPI
source: Baltic Exchange, Howe Robinson Research
Timecharter Average BCI & BPI
2001 0.97
2002 0.96
2003 0.98
2004 0.88
2005 0.92
2006 0.95
2007 0.96
2008 0.97
2009 0.83
2010 0.45
2011 0.20
2012 0.11
2013 0.81
Correlation TC BCI & BPI
2001 0.97
2002 0.96
2003 0.98
2004 0.88
2005 0.92
2006 0.95
2007 0.96
2008 0.97
2009 0.83
2010 0.45
2011 0.20
2012 0.11
2013 0.81
2014ytd 0.84
Correlation TC BCI & BPI
0
30
60
90
120
Mill
ion
Dw
t
Capesize Panamax
Supramax Handysize
+70.4mt
+211%
0
50
100
150
200
250
0
50
100
150
200
250
2006 2007 2008 2009 2010 2011 2012 2013 2014
‘00
0 U
S$
/ D
ay
US
$ /
To
nn
e
USG - N.China
NoPac - N.China
S.Brazil - N.China
TC Avg. BCI
source: Baltic Exchange, Howe Robinson Shipbrokers
Major Grain Routes vs. BCI Howe Robinson Grain Freight Rates
0
20
40
60
Jan Apr Jul Oct
2012 Avg: 7,638
2013 Avg: 6,439
2014 Avg: 14,199
0
7
14
21
Jan Apr Jul Oct
2012 Avg: 8,017
2013 Avg: 6,317
2014 Avg: 11,013
0
7
14
21
Jan Apr Jul Oct
2012 Avg: 8,138
2013 Avg: 7,542
2014 Avg: 11,423
source: Howe Robinson Research, Baltic Exchange
Capesize Panamax
Handymax
0
6
12
18
Jan Apr Jul Oct
‘00
0 U
S$
/ D
ay
2012 Avg: 6,570
2013 Avg: 6,610
2014 Avg: 10,022
Handysize
Baltic Timecharter Averages Annual Averages of Same Time Period
Eternal Triangle
DEMAND Derived Effective Demand Growth
>10%
BDI Annual Avg. y-o-y Growth 33%
Dec-13 y-o-y Growth 157%
DRY
CARGO
MARKET
FLEET
Annual Avg. y-o-y Growth 10%
Dec-13 y-o-y Growth 5.7%
source: Baltic Exchange, Lloyd's Register Fairplay, Zosen News & various other sources, Howe Robinson Research
0.0
1.5
3.0
4.5
2010 2011 2012 2013 2014
Ind
ex V
alu
e (
‘00
0)
BDI
BDI Annual Average
920
BDI vs. Fleet Growth
1,219
1,549
0%
6%
12%
18%
2010 2011 2012 2013
Y-o
-Y C
ha
nge
s
Dry Bulk Fleet
Cumulative Impact of Dry Bulk Fleet
5.7%
10%
source: Howe Robinson Research, Lloyd's Register Fairplay, Zosen News & various other sources
8 13 9 8
20 25 23 25 29
38
80 78
66
39 8
13
7
26
35
23
13
21
15 12
21 26 26 26
33
51
86
104 101
63
42
0
30
60
90
120
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014*
Mill
ion
Dw
t
Net Fleet Growth Deletion Gross Deliveries
Bulk Carrier Fleet Growth as of 1st March 2014
DRY BULK TRADE
Major Bulk Cargoes & Discharges in the Pacific
0%
20%
40%
60%
80%
100%
0
200
400
600
800
1,000
1,200
1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013
Mill
ion
To
nn
es
Iron Ore Coal
Grain (excl. Soya) Grain (incl. Soya)
% Pacific Share of Total Discharges
source: Maritime Strategies International, Howe Robinson Research
Global Steel Production Changing Balance
0%
10%
20%
30%
40%
50%
0
400
800
1,200
1,600
Mill
ion
To
nn
es
Others US
CIS EU27
Japan China
Share China
source: WSA, Howe Robinson Research
Iron Ore Exports
0
200
400
600
800
Mill
ion
To
nn
es
Australia Brazil Others
2013:
+10%
source: GTIS, LBH, Howe Robinson Research
2014:
+13%
Coal Trade Coal Exports Coastal Coal Trade
0
200
400
600
800
1000
1200
1400
2008 2009 2010 2011 2012 2013 2014*
Indonesia Australia Others
source: GTIS, Howe Robinson Research
0
200
400
600
800
2008 2009 2010 2011 2012 2013 2014*
Mill
ion
To
nn
es
2013:
+10.6%
2014:
+4.4% 2013:
+7.4%
2014:
+10.7%
Unit: mt 2010 2011 2012 2013 2014*
Other Steel 258 267 275 285 300
Forest Products 197 205 213 224 231
Fertilisers 167 178 190 196 201
Minor Ores 94 116 139 153 162
Agris 120 127 124 123 132
Bauxite/Alumina 87 103 97 122 119
Cement 116 106 108 114 121
Minerals 86 87 86 89 93
Scrap 63 63 62 64 70
Pet Coke 31 33 32 33 37
Total 1,218 1,284 1,327 1,403 1,466
Change 66 42 77 63
% Change 5.4% 3.3% 5.8% 4.5%
source: Maritime Strategies International
Key Minor Bulk Trades
GRAIN MATTERS
0
15
30
45
60
75
2008 2009 2010 2011 2012 2013
Mill
ion
To
nn
es
China Japan Mexico Saudi Arabia Egypt Indonesia S.Korea Iran
World Grain* Imports Largest Importing Countries
source: GTIS, Howe Robinson Research *Grain: Barley, Corn, Soyabeans, Soymeal, Wheat
0
5
10
15
20
25
Mill
ions T
onnes
Soybeans
Barley
Soybean Meal
Wheat
Corn
source: GTIS, USDA, Howe Robinson Research
69.0mt (+16%)
2.5mt (+14%)
8.5mt (+221%)
5.0mt (+85%)
2013/14 Forecast
China Remains the Key Grain Imports to Increase by c.26% in Crop Year 2013/14
0%
30%
60%
90%
0
30
60
90
Mill
ion
To
nn
es
US Brazil Argentina
China Share China Share China Share
World Soyabean Exports Three Main Exporting Countries
source: GTIS, Howe Robinson Research
0
3
6
9
12
15
Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14
Mill
ion
To
nn
es
Total
Waiting
Expected
Berthed
source: Bloomberg, Howe Robinson Research
Brazil Soyabean Ports Line-Up 151 Vessels on 6th March 2014
0
50
100
150
Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14
No
. o
f V
esse
ls
Paranagua Port Congestion Bottlenecks on Roads & Shortage of Warehousing
source: Port of Paranagua
0
30
60
90
120
150
180
Wheat Corn Barley Soyabeans SBM
Mill
ion
To
nn
es
2013 2014*
Grain Export Forecast 2014
source: GTIS, USDA, Howe Robinson Research
+13% +10%
Corn + soya bean shipments
to increase by 21mt
The Dawn of a New Cycle What Will it Look Like?
HR Pmx Index vs. TC Avg. BPI
Avg. Dwt Avg. TC Avg. Dwt Baltic TC
Q112 77,428 9,986 74,000 7,983 25%
Q212 78,434 10,746 74,000 9,630 12%
Q312 78,628 7,806 74,000 6,640 18%
Q412 78,490 7,934 74,000 6,553 21%
Q113 78,664 8,532 74,000 7,055 21%
Q213 77,599 8,781 74,000 7,775 13%
Q313 78,609 10,481 74,000 8,926 17%
Q413 79,370 15,269 74,000 14,234 7%
Baltic ExchangeHR Fixture ReportsDifference
0%
30%
60%
90%
0
2
4
6
US
$ M
illio
n
Fixed Costs Bunker Costs TC Bunker % Share TC % Share
Bunker Element of Freight Baltic Panamax – Soya Bean Brazil / China Ballasting ex Singapore
source: Howe Robinson Research
TC Bunker Freight
2007 82% 15% $71.8/t
2013 30% 61% $39.6/t
0
100
200
300
400
1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013
Crude Oil IFO Bunkers
Oil & Bunker Price Index 1980 = 100
source: Maritime Strategies International, Howe Robinson Research
FUEL CARGO Moves HOW MANY MILES?
766,000 Miles!! (or 30 Equatorial Circumnavigations)
At ECO Speed
A Panamax On Average
ie: 1 Fuel Tonne Moves a Laden 75,000 Dwt Panamax approx 11.4 miles
Measuring Fuel Efficiency
Measuring Fuel Efficiency Panamax Fleet
source: Howe Robinson Research
0
300
600
900
1,200
1,500
Carg
o T
on
ne
-Mile
s / F
ue
l To
nn
e (
'00
0)
Full Speed Fuel Efficiency ECO Speed Fuel Efficiency
25th
Percentile 50th
Percentile
75th
Percentile
+5.5%
-3.2% +5.0%
-6.2%
Japanese
Newbuilding +57%
+86%
+29%
+50%
Owners
Shippers/
Receivers
Shipyards
Traders
3
8
13
18
‘00
0 U
S$
/ D
ay
Avg TC BPI FFA TC BPI (Nov-13) FFA TC BPI (Mar-14)
source: Howe Robinson Research, Baltic Exchange
Forward TC Avg. BPI Monthly Avg. Spot TC Rates & FFAs
Coal 24%
Grain 18%
Iron Ore 7% Nickel Ore
7%
Steel 6%
Cement 6%
Bauxite 2%
Ferts 7%
Petcoke 3%
Others 20%
Voyages
Coal 20%
Grain 22%
!ron Ore 6%
Nickel Ore 5%
Steel 6%
Cement 8%
Bauxite 2%
Ferts 7%
Petcoke 2%
Others 22%
Employment Days
Supramax Trade Patterns 58-62,000 Dwt
Kamsarmax Trade Patterns
Coal 46%
Grain 37%
Iron Ore 10%
Minor Bulk 7%
Employment Days
Coal 58%
Grain 23%
Iron Ore 10%
Minor Bulk 9%
Voyages Avg. 8 Voyages / Year
Post-Panamax Trade Patterns
Coal 62%
Grain 15%
Iron Ore 18%
Bauxite 4%
Other 1%
Voyages Avg. 7 Voyages / Year
Coal 56% Grain
24%
Iron Ore 17%
Bauxite 2%
Other 1%
Employment Days
134
279
254
102 75
227
525 376
67
272
45
0
300
600
900
1,200
Panamax(73-78,999 dwt)
Kamsarmax(79-84,999 dwt)
Post-Panamax(85-119,999 dwt)
No
. o
f V
esse
ls
20 yrs + above 15-19 yrs 10-14 yrs 5-9 yrs 0-4 yrs On Order
Post-, Kamsar- & Panamax Fleet Development & Age Profile as of 1st March 2014
229
238
283
130
979
151
36
102
423
0
500
1,000
1,500
50-54,999 dwt 55-59,999 dwt 60-67,999 dwt
No. o
f V
esse
ls
20 yrs + above 15-19 yrs 10-14 yrs 5-9 yrs 0-4 yrs On Order
Ultra-, Supra- & Handymax Fleet Development & Age Profile as of 1st March 2014
Panamax Optimum Speed Haypoint – Zhoushan
0
15
30
45
60
10.82 15.02 20 26.5
TC
E (
‘00
0 U
S$
/ D
ay)
76,000 Dwt 82,000 Dwt NB
Freight (US$ / Tonne)
74 76 Jpn Kmx China Kmx Kmx NB 74 76 Jpn Kmx China Kmx Kmx NB 74 76 Jpn Kmx China Kmx Kmx NB 74 76 Jpn Kmx China Kmx Kmx NB
14.5 1,030 446- 2,355 1,927 5,570 15,484 14,592 17,617 17,373 20,477 28,478 27,866 31,445 31,294 34,442 48,333 48,375 52,476 52,534 55,261
14.0 2,550 1,021 2,678 2,240 6,452 16,379 15,439 17,518 17,264 20,830 29,038 28,376 31,019 30,857 34,457 48,173 48,166 51,501 51,548 54,633
13.5 4,102 2,521 3,561 2,562 7,354 17,292 16,304 17,866 17,152 21,192 29,610 28,896 31,024 30,410 34,472 48,008 47,952 50,856 50,539 53,390
13.0 4,547 2,920 5,021 4,003 8,278 17,291 16,260 18,678 17,947 21,561 29,278 28,519 31,475 30,843 34,486 47,107 47,005 50,551 50,217 53,330
12.5 5,001 4,475 5,387 4,915 8,662 17,290 17,153 18,587 18,300 21,481 28,939 29,051 31,033 30,835 34,051 46,185 46,771 49,517 49,526 52,295
12.0 6,049 5,486 5,762 5,280 8,488 17,765 17,592 18,493 18,196 20,934 29,059 29,131 30,579 30,369 33,151 45,615 46,158 48,456 48,453 50,871
11.5 6,531 5,932 6,146 5,653 8,884 17,769 17,561 18,396 18,089 20,843 28,709 28,741 30,113 29,892 32,687 44,654 45,155 47,369 47,353 49,778
11.0 6,426 5,796 6,538 5,451 17,284 17,044 18,297 17,501 27,870 27,866 29,636 28,935 43,286 43,748 46,254 45,852
10.5 6,923 5,656 6,941 5,836 17,281 16,513 18,194 17,382 27,496 26,969 29,146 28,426 42,273 42,305 45,111 44,690
10.0 6,820 5,512 6,754 5,631 16,778 15,970 17,599 16,770 26,623 26,050 28,163 27,425 40,844 40,827 43,554 43,115
$10.82 $15.02 $20 $26.50
Thank You
0
50
100
150
200
250
2001 2002 2003 2004 2005 2006 2007 2008
‘00
0 U
S$
/ D
ay
TC Avg. BCI
TC Avg. BPI
source: Baltic Exchange, Howe Robinson Research
2001 0.97
2002 0.96
2003 0.98
2004 0.88
2005 0.92
2006 0.95
2007 0.96
2008 0.97
2009 0.83
2010 0.45
2011 0.20
2012 0.11
2013 0.81
2014ytd 0.84
Correlation TC BCI & BPI
Timecharter Average BCI & BPI
0
30
60
90
120
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Mill
ion
Dw
t
Capesize Panamax Supramax Handysize
source: Howe Robinson Research, Lloyd's Register Fairplay, Zosen News & various other sources
Annual Fleet Deliveries 2013
+70.4mt
+211%
0
50
100
150
200
250
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
‘00
0 U
S$
/ D
ay
TC Avg. BCI
TC Avg. BPI
source: Baltic Exchange, Howe Robinson Research
Timecharter Average BCI & BPI
2001 0.97
2002 0.96
2003 0.98
2004 0.88
2005 0.92
2006 0.95
2007 0.96
2008 0.97
2009 0.83
2010 0.45
2011 0.20
2012 0.11
2013 0.81
Correlation TC BCI & BPI