“It’s the steel production, stupid!”
BIMCO's Peter Sand, in a new report, weighs in on the implications for the Dry Bulk sectors.Chinese imports of iron ore keep falling, while its crude steel production keeps growing. China’s increased use of scrap metal for its production of crude steel is fundamentally critical to the dry bulk shipping industry. Mostly Capesize ships are impacted by this, way beyond the temporary iron ore export disruptions in Brazil and Australia.Chinese steel production grew by a massive 12.6 million tonnes (+9.2%) in the first two months on 2019 as estimated by China Iron and Steel Association (CISA).
Port Authority: 'A strong start to 2019'
Tonnage on river increases 60 percent from 2018Through the first two months of 2019, the Port of Little Rock and its stevedorer, LSI, have seen a year-to-year increase of 33 barges, a 62% increase in activity. Additionally, tonnage is up 49,000 tons year-to-year (60%) with a total of 130,400 tons. Commodities handled during the month included aluminum ingots and tee bars, bauxite, nepheline syenite, rock and sand, scrap, steel coils, wetcake and wire rod coils. LSI expects barge activity to continue to be very strong over the next several months.Activity on the docks remained strong for February with a total of 47 barges worked- 21 more than February 2018. The 72,000 tons of cargo loaded and unloaded from barges during the month surpassed February 2018 by 80 percent.
China Busts Gangs Smuggling Scrap Steel
Customs in China's southeastern Fujian province broke up five gangs smuggling scrap steel in a late-night operation on Monday, the official Xinhua news agency reported.A total of 28 criminal suspects were held in Xiamen, Quanzhou and other cities in the coordinated operation, in which 3,237 tonnes of scrap steel was seized.The gangs had been buying the scrap in China, the world's biggest steel producer, since 2017 and sending it to Southeast Asian countries, Xinhua said.Amount of scrap smuggled was put at around 50,000 tonnes, worth some 78 million yuan ($12.2 million), as gangs sought to cash
Oil Tanker Scrapping to Hit Multi-year High
The shipping industry will this year scrap the largest number of oil tankers in over half-a-decade, driven by weak earnings, firm prices for scrap steel and the need to prepare fleets for strict new environmental regulations.The surge in scrapping underscores how the sector is grappling with one of its worst-ever crises, hit hard after rates for transporting oil plunged to multi-year lows in the wake of excess tanker supply and tepid demand as OPEC production cuts bite."The tanker markets are definitely in a trough at the moment…
Suisun Bay Vessel Removal Project Completed
Maritime Administration Executive Director Joel Szabat joined federal, state and local officials and environmental groups to mark the completion of an agreement to remove 57 non-retention vessels from the Suisun Bay Reserve Fleet (SBRF) by September 30, 2017. The departure of the Cape Borda for recycling reaches the milestone two months ahead of schedule. “Our progress in Suisun Bay is the result of hard work and smart collaboration,” said the Maritime Administration’s Executive Director Joel Szabat. “There is perhaps no greater symbol of the maritime industry’s environmental progress than what has been accomplished here. In 2009, MARAD entered an agreement with local officials and environmental groups to expedite disposal of 57 non-retention SBRF vessels…
Asia Dry Bulk-Capesize Rates to Slip; Low Demand, Overcapacity Weigh
Despite lower rates, rental prices doubled from last year; capesize vessels totalling 15 million DWT to be delivered this year - broker. Freight rates for large capesize dry cargo ships on key Asian routes are likely to drift lower as tonnage volumes outpace cargo demand even as owners resist charterers' attempts to push rates lower, ship brokers said. Despite the subdued market, capesize charter rates are still around twice the level as compared with previous year. "The market is holding up relatively nicely.
Newbuild Volatility to Alter Future Shipping Cycles -MSI
Independent research and consultancy firm Maritime Strategies International (MSI) has forecast a structural change to future shipping cycles, driven by increased volatility in newbuilding activity. In an article by Dr. Adam Kent, MSI notes that as a consequence of the current glut of excess shipyard capacity, many yards will be well-positioned to take orders and deliver within two years, should freight markets show improvement. “This may mean that we are set to see a something of a structural change in the shipping cycles going forward…
Little Rock Port Authority Reports June Shipping
Total barge tonnage through the Port of Little Rock in May was 66,000 net tons. Dock activities continue to compare favorably to calendar year 2015. Logistic Services, Inc. has handled 274 barges during the first half of 2016 year and 410,000 net tons of various commodities have moved across the docks at the Port of Little Rock. Bulk commodities outpaced break-bulk cargo accounting for 55% of the tonnage handled across the docks. Cargoes handled across the docks included DAP, sulfate, triple phosphate, urea, rock, wetcake, bauxite, granite fines, wire rod coils, scrap, stainless scrap, steel coils and pipe. The US Army Corps of Engineers reports that 979,684 tons of commodities moved through the McClellan-Kerr Navigation System in June 2016.
Maritime Turkey Set for a Tailwind
Turkey is strategically located, straddling both Europe and Asia with substantial number of Black Sea and Mediterranean Sea ports, thus making maritime trade and shipping of great importance to the country’s economy. Its extensive coastline running for 8,483 km, (1,067 km of which is island shores) has greatly contributed to the growth of Turkey’s maritime sector. Turkish shipyards have a tradition spanning eight centuries. At the time of the Ottoman Empire, shipyards were able to build large…
Dry Bulk Shipping: Improved Frieght Rates Despite Continues Fleet Growth
On 10 February 2016, the Baltic Dry Index (BDI) hit 290. At that point, a bulk carrier regardless of its size, age and fuel-efficient qualities earned a time charter average of USD 2,417-2,776 per day. Whereas the three smaller segments have seen higher earnings since then, capesize earnings lost ground up until the end of March. By mid-April, the gap closed and capesizes are back on par with the pack. Despite the fact that earnings have doubled in those two months, they remain below OPEX levels for the largest part of the fleet.
Dry Bulk Outlook Remains Bleak: BIMCO
With 12 weeks of 2016 behind us, the dry bulk market is still looking bleak. As the current low demand for transportation of commodities continues, the market is doing what it can by scrapping old ships and restraining from ordering new ones. With only four newbuilding orders registered in the first 12 weeks of 2016, dry bulk contracting is merely a fraction of previous year’s activity. New contracts for dry bulk ships have been on a path of decline in the last year and a half. Currently culminating at a level that resembles a standstill.
Plunging Scrap Steel Prices Hit Ship Recycling Revenues
The Chinese ship recyclers are feeling the heat as falling scrap steel prices have eaten into their revenues during the past one year, says a report in China Daily. The increasing costs of adopting "greener" vessel-breaking method also adds to the woes, says China National Ship-recycling Association. The latest figures show ship-recycling revenue dropped 15 percent to 3.4 billion yuan ($519 million) in China last year. According to senior industry officials, the Chinese ship recycling sector was badly impacted by the continued weakness in steel scrap prices.
Chinese, Greek Ship Owners Accounted for 40% of Global Recycling
According to Clarkson Research Services, the record pace of fleet growth over the last decade and weakening global demand outlook has left many of the major shipping segments facing severe oversupply. Demolition of older ships is one way of easing overcapacity and recycling volumes have been strong in recent years. The top ten owner countries typically account for the majority of recycling with Chinese and Greek owners leading the way. Last year a total of 860 ships of a combined 23m GT were reported sold for demolition. This is equivalent to 2% of the start year fleet.
Demolition Age Drops as the Dry Bulk Market Enters Another Challenging Year
The dry bulk market faced a lot of headwind in 2015 as dwindling demand and over-supply created very unfavourable market conditions, says BIMCO. 2016 has shown no improvements so far and prospects for the rest of the year are not looking promising. With poor earnings across the board the average scrapping age has dropped among all the dry bulk segments. The capsize segment especially has seen a big drop in the average scrapping age; dropping almost four years from an average age close to 25 in 2014 to less than 21 in 2015.
McDermott to Auction Fabrication Yard Assets
A joint venture of five industrial auction companies will sell the physical assets of the 300-acre McDermott fabrication facility in Amelia, La. McDermott continues to operate its other fabrication facilities at multiple locations worldwide. The auction of thousands of assets starts September 8, 2014 and will be conducted throughout the complex via a multiday onsite/online public auction sale. The auction will feature an extensive offering of unique offshore marine equipment, barges, winches and pumps; a wide assortment of high quality, large capacity fabrication machinery; late model welding machinery; a large offering of mobile equipment including four 300-ton capacity crawler cranes; more than 60 overhead bridge cranes up to 40 ton capacity; and thousands of plant support equipment.
Back to School
For Vigor Industrial, a privately-held shipbuilding and repair company headquartered in Portland, Oregon, the future looked bright and a bit ominous at the same time. Work was coming in, dock space was filling up, future orders were signed, and new properties purchased; in short, business was booming. But dark clouds crept in around the edges of this rosy picture. As recruiters set out to find new talent to meet the growing demand, they encountered a candidate pool without the necessary skills to pick up a welding torch and go to work.
Obsolete US Ship Recycling Target Surpassed
U.S. Transportation Secretary visits Suisun Bay in Northern California to celebrate surpassing administration's goal for recycling. Ray LaHood, US Transportation Secretary visited Shuisun Bay for the occasion. In 2010, the Department’s Maritime Administration (MARAD) committed to removing 28 ships from the fleet by September 30, 2012. To date, MARAD has removed 36 ships, with three more vessels scheduled for removal by the end of the year. “Three years ago, the Department of Transportation promised to get rid of the ships that posed a threat to the environment, and I am proud to announce today that we are delivering on that promise,” said Secretary LaHood.
Underwater Salvage Work on 'Rena' Starts Soon
A specialist team of divers from the United States, plus the RMG 280 crane barge due to arrive shortly, reports the wreck salvors. • The total combined weight of steel removed is now approximately 430 tonnes, which is more than 20 per cent of the total weight to be removed. • The RMG 280 crane barge is expected to arrive in port this evening (Friday, 14 September). • With the arrival of the barge and a specialised team of divers from the United States, underwater salvage operations are expected to commence next week. • The crane barge – which will operate from deeper water at the aft end of the bow section - can raise significantly larger pieces of steel (up to 40 tonnes) than the helicopters. • The above water and underwater operations will run simultaneously.
Push Is On To Declutter Gulf of Idle Iron
Nearly two years ago, the Obama Administration tightened rules for removing “idle iron” – old oil platforms and pipelines – and on plugging unused wells in the Gulf of Mexico. That September 2010 move was part of a federal crackdown on deepwater oil and gas operations following the 2010 BP spill. Since then, heavy-lift companies have continued to rid the Gulf of unused structures and other firms have positioned themselves for that work. Under the 2010 rules, wells that hadn't been used for five years were to be abandoned or “zonally isolated” within three years after Oct. 15, 2010.
Wrecked Container Ship 'Rena' Salvage & Cargo Recovery Update
The first steel fore sections cut & removed from 'Rena', with the Bell 214 heavy-lift helicopter completing 14 separate lifts to the barge Kapua. • The barge made its first landing in Tauranga with an estimated 40 tonnes of steel, which included deck equipment and pieces of winches from the fo’c’sle. • Work is continuing with the modifications to the helicopter landing platform, and pre-cutting of upper decks, fo’c’sle deck, and equipment. • Helicopter-to-barge transfers will continue next week.
Inland Salvage Completes Salvage of Sunken Barge
Inland Salvage Inc. Completes Lightering and Salvage Operations of Sunken Hopper Barge. Inland Salvage Inc.recently completed the removal of approximately 1000 tons of structural scrap steel from a sunken hopper barge and subsequent salvage of the barge which had been obstructing a loading dock on the Mississippi River near LaPlace, LA. Immediately upon being notified by the dock's owner that Inland Salvage Inc. (ISI) had been appointed as the salvor, ISI responded to the sinking of the 195' hopper barge laden with 1,000 tons of scrap metal when the barge sank.
Dry Bulk Scrapping Rises
According to Braemar, 2011 is already a record year for dry bulk carrier demolition. In Jan-May 2011, 13.6m Dwt of bulkers have been scrapped, including 7.1m Dwt of Capesize (over 120k Dwt) bulkers. If scrapping continues at this pace for the balance of 2011, it could reach 32.6m Dwt, more than three times the previous record set in 2009. Demolition has previously peaked in years of credit crunches: In 2009, 11.7m Dwt of bulkers were scrapped following the global credit crunch. Scrapping was high even though prices per LDT were down on average for the year to around USD 260 compared to an average of around $370 in 2007. In 1998, 11.2m Dwt of bulkers were scrapped following the Asian financial crisis.
Donjon Towing and Transportation Projects on the Rise
Donjon Marine, Co., Inc., a global marine services provider based in New Jersey, has announced a number of marine transportation projects the company has been involved with over the last months. SIMS Metals: Donjon tugs transport the barges that carry all of the steel scrap in the New York/Metropolitan Area for SIMS Metals as part of a contract that runs through 2015. Donjon handles approximately 1,800,000 tons of mixed grades of scrap steel each year. O&G Industries: Donjon transports various types and grades of bulk stone products from two upstate New York quarries to various New York/Metropolitan Area receiving facilities in support of its customer, O&G Industries, and its customers. Donjon’s agreement with O&G runs through Spring 2012.