‘Shipshape 10’ News for Week Ending November 27, 2016

‘Shipshape 10 List’, a list of news and articles published in the current week that a senior executive in shipping, shipping finance, commodities, energy, supply chain and infrastructure should had noticed; news and articles that are shaping the agenda and the course of the maritime industry.                                                                                                                                                                                                                               Sometimes seemingly tangential, sometimes humorous, occasionally sarcastic, but always insightful and topical.
                                                                                                                                             And, this week’s ‘Shipshape 10’:                                                                                                                                                                                                                                 The dry bulk market has been having an exceptional time, all things considered, and the Baltic Dry Index (BDI) has almost tripled since February this year when the market established an absolute bottom. Lots of researching whether this is due to a structural recovery or plain seasonality.

1. Dry-Bulk Shipping Owners Get Reprieve as Rates Rebound (from the Wall Street Journal)  

In the containership market, another bleak sign where a seven-year old panamax containership vessel was sold for scrap; less than a decade ago, such vessels were selling for $80 million. A sign of how bad the overall containership market is, and the high asset risk shipowners (and investors) have to undertake:

2. Seven-year-old Rickmers boxship sent for scrap (from Splash 24/7)    

While post-elections in the US has been lots of speculation about the direction of the new administration in terms of trade and infrastructure projects, a couple of articles on the subject:

3. TPP: What is it and why does it matter? (from BBC)

and,

4. China Touts Its Own Trade Pact as U.S.-Backed One Withers (from the Wall Street Journal)

In our last week’s report, we included an article about the Taiwanese government setting up emergency funding for their shipping sector; and, the week before that, another article about the S. Korean government supporting their shipping sector. Now, the Singaporean government falls in line, too, by supporting their offshore sector. Hopefully the Greek shipowners will manage to do without government support, if need be. (“One cannot take from someone who does not own” from the Dialogues of the Dead, Lucian of Samosata, 2nd century BC; cynic philosopher Menippos would not pay a coin (obol) to Charon, the ferryman of Hades of the souls of newly deceased, arguing as above; a very valid argument in today’s Greece, in any case.)

5. Singapore government intervenes to save struggling offshore sector (from Splash 24/7)

However, it’s worth noting that Korea Line Company (KLC), a company that had their own spectacular bankruptcy a few years ago in Korea, now has outbid the favorite Hyundai Merchant Marine (HMM) acquiring Hanjin Shipping’s container business; strangely, Korea Line never before had an exposure to or experience with the containership business. Having a previously bankrupt company rehabilitated and growing would seem to be the forces of capitalism at their best:

6. Why is Korea Line buying Hanjin Shipping’s Asia – US container business? (from Seatrade)

However, HMM who was poised to join the 2M Alliance (A.P. Moeller Maersk and MSC), now has been rejected by 2M; for sure, the containership liner industry is in the middle of major re-alignments in a market that keeps looking gloomy:

7. 2M Alliance rejects HMM (from the Korea Times)                                                        

Another week, and another shipping bank has to break some more bad news. NordLB in the news with additional provisions for their shipping loan portfolio:

8. NordLB warns on €1bn loss for year as shipping loans bite (from the Financial Times)

However, the capital markets show signs of thawing for shipping ideas, at least selectively. The Saverys family managed to raise $100 million for their Special Purpose Acquisition Vehicle (SPAC) for acquiring distressed shipping assets (ticker: HUNTU):

9. Hunters with a big warchest for dry bulk shipping (from Seatrade)

Some thoughts about shipping, mostly positive, ‘thankful’ thinking, in the spirit of the season:

10. A Thanksgiving for shipping (from Splash 24/7)

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A majestic sunset. Image credit: Karatzas Images


© 2013 – present Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.

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