Reoccurrence sluggish recovery difficult

Due to the slow economic growth, weak import demand, world economic growth is unstable and is not expected optimism, especially the needs of the largest countries - China into the economic structure adjustment, slowing demand, as well as oil-based international commodity prices continue decline, coupled with still no substantive contradiction capacity oversupply relief, in 2014 the global dry bulk shipping market is still in the doldrums, it is difficult to improve the performance of the owner, even many shipowners loss continues to expand -

Chen Yi

Status quo

Demand as expected & nbsp; international freight fell across the board

As of December 12, the international dry bulk freight index (BDI) closed at 863 points, compared with last year fell by 44%, the annual daily average of 1115 points to 1206 points over last year dropped by 7.5%, for international the second lowest since the financial crisis, its lowest point occurred in 2012, BDI annual daily average of 920 points. During the three main ship fell across the board, including Capesize Index (BCI) for the 1990 annual average daily points, compared with last year, down 6%; Panamax Index (BPI) for 965 points, compared with last year, down 19 percent; Supramax vessels index (BSI) for 940 points, down 4.4 percent over last year.

2014 international dry bulk shipping market into the doldrums again, mainly due to:

Demand for commodities from hot to cold, prices continued to fall, prices are expected to make the demand side sentiment warming. As the largest iron ore transport dry bulk, because prices continued to decline this year, especially in iron ore prices fell in the fourth quarter to expand, so steel prices is expected to have a strong, coupled with high inventory, limited demand imported natural decrease. Traditional winter season offering early curtain, December 12 capesize daily rent has been reduced to $ 6,000, fell to historically low levels, and continued for four months last year, far less compared to the hot market, dragging down the entire year tariff levels.

The second major types of cargo - coal shipments fell unexpectedly. By economic restructuring, imported coal is challenged to domestic coal prices, the world's largest coal importer - China, from January to November coal imports fell by 9.4%, while the month of November is down 27 percent, ending four consecutive years of double-digit growth, given China's coal imports has shrunk dramatically, CLARKSON predict this year's global seaborne coal grew less than 1%. Because Indonesia's export controls, nickel ore, bauxite is significantly negative growth, significantly reduce these kinds of goods, and seriously eroded the Panamanian ship, Supramax vessel freight levels.

Fuel prices continue to decline, resulting in tariffs continue to decline. International crude oil oversupply, prices continued to fall, to the end of the fuel near Singapore No. 380 is still $ 600, but now has fallen below $ 380, a year slid nearly forty percent. However, due to the shipping industry overcapacity, it is difficult to grasp the right to speak tariffs, oil prices will soon be transferred to the freight decline, the owner did not get much benefit, the biggest beneficiaries of shippers and charterers this from tariffs and Rent can be confirmed. Superposition of these three factors, prompting the shipping market this year than last year.

Higher volume doubled capacity growth & nbsp; coastal freight lows

2014 was the worst year for coastal shipping. According to the Shanghai Shipping Exchange data show that the measure of the strength of the core coastal freight index - coastal coal freight index, the annual daily average of 629 points, compared with last year fell by 25%, which is the index to its lowest on-line by the end of 2011 year. Where the mainstream route - Qinhuangdao to Shanghai, Guangzhou, the average tariff of coal were 25.4 & nbsp; yuan / ton, 34.5 yuan / ton, respectively, compared with last year fell by 29%, 19.4%, above the level of the tariff is not end of the century.

Although tariffs special events triggered by the last quarter soared last year, higher freight base year, would lower tariffs are to be expected, but such a substantial correction, or exceeded expectations of most people in the industry. Let's look at the coal demand, thanks to the Shenhua, China Coal and other large coal enterprises in coal prices move sharply lower, weakening the imported coal price advantage, the first 11 months of this year, China's coal imports in foreign trade for the first time in nearly four years of negative growth, to a certain extent stimulating domestic demand for coal. According to authoritative data show that as of November, in the coastal water of 604 million tons of coal, representing an increase of 25 million tons, an increase of 4.3%; look at the capacity situation, according to Transportation Department data show that as of the first half of this year, tons more than the provincial coastal dry bulk carriers totaling 1698, 54.48 million dwt, compared with the end of 2013 to reduce the 29, 700,000 dwt, a decline of 1.27%. In recent years, this is the total size of coastal dry bulk capacity declined for the first time, as a result of sluggish freight reason, the market has begun to reduce the investment in new capacity.

From the perspective of demand and capacity, the market should give some positive reviews, but why the market is so not to force it, mainly due to the following:

Stock capacity too large, the current low growth in demand by making it difficult to digest. Currently coastal capacity reached 55 million dwt, 21 million in 2008 compared with an increase of 1.6 times, while coal shipments to 660 million tons this year, compared with 2008's 420 million tons, an increase of only 57%, capacity growth rate to be higher volume growth doubled, as the market to maintain the equilibrium level, preliminary estimates, the current surplus capacity of about 20% -30%, the excess capacity of between 12 million to 15 million. If there is no man in the fourth quarter last year, soaring prices, the annual average tariff will not be much higher than this year, as high oil prices after deducting factors, tariffs can be worse than this year, so this year should be a continuation of last year's downturn in freight rates on the basis of is reasonable.

Northern coal port expansion benefit show, berths increased loading rate increase, the ship turnover rate, capacity began to overflow. A few years ago, except Qinhuangdao Bohai Bay coal port group, invested heavily in the construction of port berths, the last two years have been put into use, the port berths increased significantly, Qinhuangdao Port congestion before the ship began to disperse these ports, the data show that this year Huanghua, Tianjin Port two more than last year shipped 24 million tons of coal last year Huanghua, Jingtang, Caofeidian Port over the previous three year shipped 70 million tons of coal, but the amount of Qinhuangdao Port coal did not increase the number of increments for two years less than 2 million tons, 98 percent of the incremental coal diverted to these ports. Coal shipments due to uneven distribution, coal transportation hub - Qinhuangdao Port congestion disappears, significantly reducing waiting time poise, even do pick by ship turnover rate, the stock of the ship began to overflow, leading to excessive competition in the transport market.

Continued decline in fuel prices continue to conduction to tariffs. And international fuel prices, as domestic fuel prices from an average of 180 5100 yuan / ton last year fell to 4,100 yuan, down 20%, due to fierce market competition, falling oil prices has prompted tariffs stumble endlessly. Such as the decline in oil prices benefits stalls upgrade this year, the equivalent of an additional tariff on the actual market price of about 4 yuan.

Guess

Converting market turnaround next year

2014 will soon be over, the new year approaching, some of the world famous institution for the global economy in 2015 have made a prediction. Where the 2015 WTO global trade growth from the previous forecast of 5.3 percent down to 4 percent, far below the growth rate in April this year, the forecast made by the organization. Today's developed economies are gradually moving towards Industry 4.0, the Internet, high-end manufacturing, new energy revolution is being integrated into traditional industries, the United States, Europe and even started "to coal-based." The emerging economies due to its development is limited, especially in China's economic growth in 2015 may be cut to about 7%, demand for commodities is difficult to have a big improvement, some commodities may even negative growth, so that capacity oversupply contradiction difficult to resolve in the short term. Looking ahead to 2015, the global dry bulk shipping market is still difficult to bail out, some ship and aviation area may be even more difficult than in 2014, the shipping industry will remain low for a long time, the owner of the market to gradually adapt to the "new normal."

International dry bulk shipping market situation is more severe

CLARKSON recent global transport iron ore, coal predict, the agency forecast 2015 global iron ore shipping capacity will grow by 6.6%, coal shipping capacity will grow by 2.2 percent, food up 0.7% of the entire dry bulk demand growth 3.8 percent, the lowest growth rate in nearly four years. Then from the perspective of the supply capacity of the agency in 2015 were predicted global capacity growth, which Supramax vessels fastest growing 6.3%, followed by the capesize force grew 4.9 percent, an increase of 4.3% Panamax The whole dry bulk capacity growth of 4.9% in total, 1.1 percentage points higher than the capacity demand, excess capacity continued to show status. "The old account is not also a new account again," in 2015 the international dry bulk shipping situation is still grim than this year may, in particular, a large number of the next two years will now ship 64,000 tons of energy-saving water, for Supramax vessels One can imagine the pressure on the market, the market adjustment has not ended, the short-term recovery is basically hopeless.

Coastal tariffs still remain low oscillation pattern

The recent meeting of the Central Economic Work Conference set the tone again, "maintaining stability", fiscal policy, monetary policy will not be a big change, and the economy, "stability" Lord.

In the new year, we should pay close attention to the state environmental protection, imported coal policy developments in the micro. Recently approved by 27 countries, focused on "West to East" UHV project, the future will greatly ease the coastal coal demand. And starting next year, the state to regulate the import of low quality coal, coal beneficial to stimulate domestic demand in the short term for the formation of good coastal shipping. Overall, demand for coal next year's steady slowing down, but the ups and downs of the situation is unlikely to occur.

From the capacity point of view, due to the market downturn, losses, shipbuilding investment will fall, the peak capacity growth has been in the past. In addition to the background of the current large-scale state-owned foreign shipowners, ship financing banks have to shrink the front, very difficult to finance shipbuilding community owner, the late oil prices coupled with bearish, shipowners sensitivity of lower oil prices from the previous month, the new ship fuel The temptation in sustained reductions, while boats Used boats due to the lowest bidder, favored by the market. Used boats active in the market, help revitalize the stock vessels, reducing shipyards new orders will help gradually resolve long-standing problem of excess capacity, although this process is relatively slow, not short-term impact on coastal freight, but will cabotage market to produce long-term positive. 2015, domestic coal demand, capacity is unlikely large-scale changes in the state of imported coal orientation, as well as God, Huawei's first coal prices coal can continue to maintain the advantage, since the new year will be the coastal shipping market the decisive role, will change along its coastal freight will fluctuate, but the moment it is difficult to resolve the contradiction between supply and demand capacity, coastal freight rates still remain low oscillation pattern.