Hard to change the overall situation of oversupply of shipping capacity

2014 global economic downturn, the degree of difference between the larger national economic recovery, is still in a weak trend in most developed countries, affected by commodity trade shrinking, the overall demand is weak, moderate growth in dry bulk shipping trade. According to Clarkson expects 2014 global dry bulk shipping to 4.502 billion tons, up 4.5 percent; in 2015 it will be difficult to have a significant breakthrough.

First, the international dry bulk shipping demand is low die hard

Iron ore competition & nbsp; capesize market is more concerned about the remote needs to be

World Steel Association expects 2014 global crude steel apparent consumption of 1.523 billion tons, an increase of 3.3%, slightly higher than the 2013 increase. The amount of global seaborne iron ore steady rise, Clarkson expects 2014 global iron ore shipping capacity for 1.307 billion tons, an increase of 10%, higher than the growth rate last year.

Australia, BrazilIron oreIncreasing production in 2014 after four mines concentrated expansion, continued to expand in 2015, is expected to add about next year supply of iron ore in Brazil, Australia, 130 million tons. Affected by continued low prices, the cost impact of non-mainstream mine, cut a few. Taking into account the high cost of regulation and cost mines iron ore prices next year to break even low and other factors, is expected to reduce non-mainstream next year at around 50 million tons, is expected to add overseas iron ore production in 2015 is also about 80 million tons.

With Australia, Brazil, production, market share and more intense competition. Australia due to transport distance, mining, logistics and cost advantages, are constantly squeezing share of Brazilian iron ore.

Then from iron ore imports in terms of, in 2001, Australia, Brazil, the share of imports was essentially flat, maintained at 33% -35%, the share of imports in India is ahead of Brazil, but after the financial crisis, the share of imports from other countries gradually being squeezed, India due to the significant reduction in the policy, the share of imports in Brazil, Australia, showed a substantial increase, while the amount of imported iron ore in Australia have begun to take the share of iron ore in Brazil, in June 2013 the share of Brazil's imports drop to about 13% low, although late has increased, but only 16-21%. The share of imports rising Australian mining ended in October 2014 about 62% of its share of the Brazilian ore, Australian mining share reached 83%. With Brazil, release, non-mainstream national decline in the share of the Australian mine production is expected in 2015, the proportion of iron ore in Brazil, Australia will be further increased.

Based on this background, in order to reduce transport costs and make prices more competitive compared with Australia, while reducing emissions generated during transport, Vale 40-ton ore large fleet into the market, and the formation of the joint owners around the world 40-ton large ore carriers VALEMAX fleet, trying to reduce the size advantage with rival tariffs poor.

China's crude steel production is the main pillar of the global high volume of seaborne iron ore, Australian mining has a significant advantage in the competition, but the transport distance between Australia and China is short, and expanding market share, is not conducive to Capesize bulk carrier market. For Capesize vessels, the lack of support for long-haul, Vale as Brazil's largest miner, which has Valemax fleet, as well as the Philippines, Malaysia and transit aid distribution center sits, and with the domestic shipping giant signed a long-term cooperation agreement, the possibility of improving fundamentals capesize Vale is still largely dependent on the amount of spot market charter. If the Brazilian market Capesize demand for light, capacity or will focus on the Pacific market, resulting in excess capacity to focus, which will directly affect the Australian mining and freight transport.

October 2 this year Valemax straight Dong Port of Qingdao, and no previous policy and public pressure. November 23, Jiangsu Provincial Government and the Brazilian delegation met with Vale executives on a number of cooperation Lianyungang Vale held talks with the hope that the two sides to accelerate Lianyungang bulk cargo routes and the establishment of the Brazilian iron ore spot market in Lianyungang other cooperative matters. With the gradual development and in-depth Vale's China business cooperation with all parties, and China already has many ports the ship docking capabilities, or by coming straight Valemax will increase, if all formal straight by Chinese ports, it is understood, is expected to capacity in about 5000-6000 tons / year. Will directly affect the capesize demand.

China factor & nbsp; imported coal incremental inhibition

Global coal market oversupply, the amount of increase in seaborne coal into the stationary growth phase. Clarkson expects 2014 global coal shipping volume 1.236 billion tons, an increase of 4.8%.

India, Japan's coal imports surge. Due to factors coal production, the huge demand for coal and electricity prices relatively low international coal prices low, such as India, Coal India increased significantly, as of September 2014, India's coal imports to 16 million tons, an increase of 19% last year. Separate data showed that, due to increased demand for electricity and coal-fired power plants in India, India's demand for coal remains strong, Australian Resources and Energy (BREE) in 2014, India imported 135 million tons of thermal coal, an increase of 4%. Due to the low international coal prices, Japan is more dependent on coal, steam coal imported from Japan in August remained high at 10.48 million tons, an increase of 10%.

Chinese customs statistics, in October 2014 imports of coal and lignite for 2,013 tons from January to October was 24,299 tons. Relative to last year by 7.7%. Domestic economic growth is slow, sluggish domestic demand, coal prices remain low, domestic coal spreads shrinking domestic pressure to increase the supply of water and electricity as well as factors such as environmental policy, a marked decline in the growth rate of China's coal imports. Meanwhile, the state issued a series of policies favorable to the domestic coal industry, the Ministry of Finance decided since October 15, 2014, to cancel other bituminous coal anthracite, coking coal, coking coal other than zero provisional import tax rate of other coal, briquettes and other fuels were implemented to restore 3%, 3%, 6%, 5% of the MFN rate. In addition, the deployment of the National Development and Reform Commission meeting: 2014 to reduce the 50 million tons of coal imports. China imported coal will face greater pressure.

2015 coal market oversupply pressures still exist, the social stock is still high and the downstream demand along with the domestic coal market, coal prices in sharp curb. Taken together with the increase of coal import tariffs and barriers to entry and other measures to improve the quality of restricting imports of coal, China factors will inhibit the growth of coal imports in a given period, which will be offset by other countries or the demand for imported coal, thus affecting Panamax recovery.

Cereal production increased significantly & nbsp; but demand is relatively weak

US grain production this year will hit a record high, also competing cereal yield, while cereal production in importing countries also increased, which led to the global cereal import and export markets shrink, because the main grain trade may reduce demand for land fertility transportation of grain did great as expected.

Statistics show that in 2014 will be 111 million tons of soybean shipping volume, an increase of 7.8%, although long distance shipping soybeans, soybean shipping volume but accounts for less than one tenth the amount of coal shipping; Also, food seaborne trade Despite the increase in the amount raised, but because of its seaborne coal shipping volume was only 30% of the consumption effect on Panamax shipping power is relatively limited.

According to the UN Food and Agriculture (FAO) report, global cereal production yield for two consecutive years, resulting in global cereal ending stocks rose to the highest level in 15 years. Global coarse grain ending stocks will increase to 248.3 million tons of the highest level. Because of supply growth, lower grain prices, but also shows the weak overall demand, the increase in demand is less than supply growth situation will continue.

Bauxite, nickel and other trade hard l & nbsp; transport demand remains sluggish

Indonesia's export ban in 2014 to make nickel ore and bauxite trade adversely affected, according to Clarkson expects 2014 global shipping capacity of 110 million tons of bauxite, down 21%. Nickel ore shipping capacity of 62 million tons, down 23%. In addition, the Indonesian government plans to increase coal mining taxes also inhibited the transport needs. Although Supramax vessel carriage of goods can be relatively high, but the sharp decline in the volume of bauxite and nickel ore, coal shipping demand outlook uncertain, plus grain shipping volume is low, for the continued growth of super Handysize shipping force, the supply and demand imbalance situation still continues.

Second, the global dry bulk overcapacity situation continued

Overall capacity will show steady growth & nbsp; pressure still exists

According to statistics, as of the end of September, the number of global dry bulk vessels up to 10,278, the fleet with a total capacity of about 749 million deadweight tons, an increase of 4.9%. Among them, the total number of Capesize vessels 1621, with a total capacity of about 304 million deadweight tons, an increase of 4.3%; Panamax 2443 Total number of vessels with a total capacity of about 193 million deadweight tons, an increase of 6.7%; Supramax Total number of vessels ship 3094, with a total capacity of about 164 million deadweight tons, an increase of 6.0%; Handysize vessels totaling 3120 the number of vessels with a total capacity of about 089 million deadweight tons, an increase of 1.5%. From the above data, Panamax and Supramax shipping force faster than the growth rate of total capacity, excess pressure increasing; capesize slightly lower than the total capacity growth, showing steady growth. Another According to statistics, by the end of 2013 the total size of the dry bulk fleet 717 million dwt, representing the end of 2012 rose by 6%. 2014 is expected to total fleet capacity growth will be 5.4%, slightly lower than last year's 6% growth, or will continue to grow steadily in 2015.

New and old alternate & nbsp; the ship is in transition

2014 new single sign decline, the data show that from January to September the global dry bulk carrier vessels entered into a single new number is about 620, down 16.6 percent year on year, the new single sign about 54.3 million dwt, down 7.7% year on year ; sub-ship, the January to September, new capesize vessels newly signed single count of approximately 125, down 8.9% year on year, the new single sign about 25 million deadweight tons, down 1.2 percent year on year; Panamax new signed a single number similar to last year, but the new signing of a single volume, but rose 2.2%; Supramax vessels newly signed single count down 14.5 percent year on year, the new single sign down 15 percent year on year; it can be seen, along with the port continues perfect, the ship also follow the development of a new sign in the new boat this year alone increased deadweight increased. 2015 The new ship will replace more traditional ship.

Deliveries low & nbsp; delayed delivery should be improved

Delivery has declined, the data show that from January to September 2014, the global dry bulk delivery is not ideal, delivered about 39.5 million dwt, down 19.3%, which in September for dry bulk deliveries 5.46 million dwt, if the delivery rate of 70% of the year is expected to deliver dry bulk capacity of about 46 million dwt. Specific sub-ship, the headlands ship deliveries down 14.9% year on year, Panamax deliveries down 24.8% year on year, Supramax vessel deliveries fell 21.6%. 2014 dry bulk cargo delivery situation does not appear to focus, in 2015, or will face greater pressure to deliver.

Low levels of ship dismantling

Data show that from January to September 2014, the global dry bulk carriers dismantling about 11.6 million dwt, down 36.8%, accounting for 1.6% of existing capacity, 29.5% of new vessels delivered, dismantling of existing capacity have had little impact capacity. Among them, the January-September Panamax dismantling higher amount of approximately 2.6 million deadweight tons, an increase of 17%, but only 1.5% of the existing fleet capacity Panamax, 23.1% of new vessels delivered, though its demolition solution has increased, but in terms of overall capacity is still very low, 22.4% of the total capacity of the dismantling, at a relatively low level. Capesize ship dismantling about 3.6 million dwt, down 42%, 31.2% of the total capacity of dismantling; Supramax vessel dismantling volume fell 43.5 percent, 21.6 percent of the total capacity of dismantling. As can be seen from the figure, the dismantling of the amount currently in the downward trend, the next ship scrapping amount will remain at a low level.

Under the impact of sluggish economic environment, dry bulk carriers in signing new orders, deliveries decline while the amount of ship dismantling and the downward trend in the low level, resulting in an overall excess capacity situation is hard to change. 2014 go slow pace of delivery of new vessels, delayed delivery of new vessels, or will likely increase in 2015 focused on the delivery capacity. Excess capacity in the market outlook is still difficult to resolve conflicts.

In addition to these forms of supply and demand, no significant recovery of the economy in the form of international dry bulk freight market is still suppressed. Economic support in the form of international dry bulk freight market does not appear fundamental shift, International Monetary Fund (IMF) is expected for next year is still optimistic about the global economy, the global economic growth in 2015 is expected to be reduced from the previous value of 4.0% to 3.8%, potential growth in advanced economies declined in 2015 the growth rate of only 2.3 percent. I am afraid. Among them, Germany, Italy, Japan and Brazil, the largest growth is expected in the lower degree. Probability troubled eurozone deflation in 2015 was about 30%, the probability of a recession is close to 40%. Meanwhile, China's economy is in the form of one of the important variables affecting the international shipping market, overcapacity and credit problems, or will also restrict the Chinese economic trend. Based on such a form, the international dry bulk freight market is expected to demand growth will face greater challenges and risks.

On the whole, in 2014 the global dry bulk capacity is expected to grow by about 5.4%, about 4.5% increase in demand, excess supply and demand situation remains. Domestic and foreign economic forms is still not optimistic that this will be more limited global dry bulk freight demand pull. Expected international dry bulk freight market is still sluggish groping forward.