Dry Bulk Market: Analyzing Current Opportunities and Operations Trends
1
QUIZ TIME
1. WHAT IS NATIONAL DISH OF INDONESIA?
(A) DRY FRIED RICE
(B) NASI GORENG
(C) PUMPKIN FREID RICE
(D) SPICY FRIED RICE
2
QUIZ TIME
2. IF YOU SPEND ONE DAY AT EVERY ISLAND
IN INDONESIA, HOW LONG IT WOULD TAKE
TO SEE THEM ALL?
(A) 5 YEARS
(B) 17 YEARS
(C) 28 YEARS
(D) 48 YEARS
3
ROADMAP
PAST
4
PRESENT
FUTURE
DRY BULK MARKET-AN OVERVIEW
GLOBAL
DRIVERS
IMPACT
5
LET US ROLL…
PAST
6
PRESENT
FUTURE
Demand Side: China Impact
Source: ICAP
7
India and Indonesia…had own issues
INDONESIA
INDIA
Export tax
Price
Crash
Export
fell by
28%
Capital
Crunch
8
Indonesia’s ban on NI and
BAUXITE
Procedural
hurdles
Indonesia’s government still
allows exports of copper, iron
ore, lead, and zinc, no relief is
offered to nickel and bauxite.
Shift from a surplus of 41,000
tons in 2014 to a deficit of
36,000 tons in 2015
Supply side got worsened, too..
Source: Clarksons
9
ROADMAP
PAST
10
PRESENT
FUTURE
“Act of balancing” …order of the day
11
India is poised to grow….
Name is RAJAN, game is BOND
12
I am your RIGHT CHOICE baby
How it may happen….?
01
02
• Fresh lease of life to India's ties with
the seven nation regional grouping;
• To work on increasing imports from
SAARC member-states to narrow the
large trade surplus in India's favor
• Statesmanship… Action Packed 5 yrs
03
13
Issues
Growth
China’s Nickel Ore story
14
What are the options?
NICKEL
INDO
72,000 mt
per month
15
CHINA IN GENERAL
PHL
27,700 mt
per month
(-)
(+)
High Iron ore
Inventory
Growing
Appetite
Indo flow
slowdown
Australia and
Brazil more
16
ROADMAP
PAST
17
PRESENT
FUTURE
Global Demand is set to rise
18
Life understood backward, BUT can be lived forward
2014
2013
ECONOMY
YEAR 2013
YEAR 2014
USA
INCIPIENT RECOVERY
CONSOLIDATED RECOVERY
EUROPE
RECESSION
INCIPIENT RECOVERY
CHINA
THREAT OF HARD LANDING
REFORMS & STABLE GROWTH
JAPAN
START OF EBENOMICS & QE
CONCRETE RESULTS & QE+
EM
IMPACT OF TAPER
GROWTH ACCELERATION
Source: UBS
19
Global Coal Consumption…..Here to Stay
(BP Energy Outlook 2035)
20
Future Developments
Intra-Asian trade is set to grow, particularly after
2015 when the ASEAN (Association of South
East Asian Nations) free trade area comes into
effect in full.
The exchange of agricultural bulk commodities
between ASEAN and China, of coal from
Indonesia to The Philippines, or steel from
Malaysia to Vietnam is going to be big business.
21
How does supply side look like….
100%
25%
1
41
5
90%
79
76
3
123
20%
80%
12
70%
170
60%
15%
115
225
50%
2016
103
2015
24
40%
30%
10%
23
152
20%
89
176
5%
216
10%
0%
0%
Capesize 120K+
P-Panamax 85-119k
Panamax 70-84k
Supramax 40-69k Large Handy 24-39k Small Handy 10-23k
Source: ICAP
22
2017
2014
ORDERED
CONCLUSION
DRY BULK
MARKET IN
RECOVERY PHASE
23
ASSOCIATED
ECONOMIES
HAVE TO
PROSPER
INTROSPECTION
INTEGRATION
INNOVATION
THANKS VERY MUCH!
24
QUIZ TIME
1. WHAT IS NATIONAL DISH OF INDONESIA?
(A) DRY FRIED RICE
(B) NASI GORENG
(C) PUMPKIN FREID RICE
(D) SPICY FRIED RICE
2
QUIZ TIME
2. IF YOU SPEND ONE DAY AT EVERY ISLAND
IN INDONESIA, HOW LONG IT WOULD TAKE
TO SEE THEM ALL?
(A) 5 YEARS
(B) 17 YEARS
(C) 28 YEARS
(D) 48 YEARS
3
ROADMAP
PAST
4
PRESENT
FUTURE
DRY BULK MARKET-AN OVERVIEW
GLOBAL
DRIVERS
IMPACT
5
LET US ROLL…
PAST
6
PRESENT
FUTURE
Demand Side: China Impact
Source: ICAP
7
India and Indonesia…had own issues
INDONESIA
INDIA
Export tax
Price
Crash
Export
fell by
28%
Capital
Crunch
8
Indonesia’s ban on NI and
BAUXITE
Procedural
hurdles
Indonesia’s government still
allows exports of copper, iron
ore, lead, and zinc, no relief is
offered to nickel and bauxite.
Shift from a surplus of 41,000
tons in 2014 to a deficit of
36,000 tons in 2015
Supply side got worsened, too..
Source: Clarksons
9
ROADMAP
PAST
10
PRESENT
FUTURE
“Act of balancing” …order of the day
11
India is poised to grow….
Name is RAJAN, game is BOND
12
I am your RIGHT CHOICE baby
How it may happen….?
01
02
• Fresh lease of life to India's ties with
the seven nation regional grouping;
• To work on increasing imports from
SAARC member-states to narrow the
large trade surplus in India's favor
• Statesmanship… Action Packed 5 yrs
03
13
Issues
Growth
China’s Nickel Ore story
14
What are the options?
NICKEL
INDO
72,000 mt
per month
15
CHINA IN GENERAL
PHL
27,700 mt
per month
(-)
(+)
High Iron ore
Inventory
Growing
Appetite
Indo flow
slowdown
Australia and
Brazil more
16
ROADMAP
PAST
17
PRESENT
FUTURE
Global Demand is set to rise
18
Life understood backward, BUT can be lived forward
2014
2013
ECONOMY
YEAR 2013
YEAR 2014
USA
INCIPIENT RECOVERY
CONSOLIDATED RECOVERY
EUROPE
RECESSION
INCIPIENT RECOVERY
CHINA
THREAT OF HARD LANDING
REFORMS & STABLE GROWTH
JAPAN
START OF EBENOMICS & QE
CONCRETE RESULTS & QE+
EM
IMPACT OF TAPER
GROWTH ACCELERATION
Source: UBS
19
Global Coal Consumption…..Here to Stay
(BP Energy Outlook 2035)
20
Future Developments
Intra-Asian trade is set to grow, particularly after
2015 when the ASEAN (Association of South
East Asian Nations) free trade area comes into
effect in full.
The exchange of agricultural bulk commodities
between ASEAN and China, of coal from
Indonesia to The Philippines, or steel from
Malaysia to Vietnam is going to be big business.
21
How does supply side look like….
100%
25%
1
41
5
90%
79
76
3
123
20%
80%
12
70%
170
60%
15%
115
225
50%
2016
103
2015
24
40%
30%
10%
23
152
20%
89
176
5%
216
10%
0%
0%
Capesize 120K+
P-Panamax 85-119k
Panamax 70-84k
Supramax 40-69k Large Handy 24-39k Small Handy 10-23k
Source: ICAP
22
2017
2014
ORDERED
CONCLUSION
DRY BULK
MARKET IN
RECOVERY PHASE
23
ASSOCIATED
ECONOMIES
HAVE TO
PROSPER
INTROSPECTION
INTEGRATION
INNOVATION
THANKS VERY MUCH!
24