Home » Market uncertainty drives down the BDI now at 1,555…

Market uncertainty drives down the BDI now at 1,555…

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John Faraclas

The BDI dropped further down earlier on today at 1,555 – minus 54 points amid a geopolitical mayhem! John Faraclas’ brief recap:

The Capes’ BCI witnessed a three digit fall – 224 points and now stands at 2,792 points; CAUTION! If it wasn’t for the Panamaxes’ rise the BDI was going to be down close to 100 points!

The Panamaxes BPI gained 64 points and that saved the day – at 1,431 points holds on…

Down three points for the Supras’ BSI now at 994…

Down two also for the Handies’ BHSI now at 560 points.

All in all a downwards Dry Market irrespective of the BPI’s rise… Once again one size’s rise or fall DOESN’T constitute a market!

The Wets once again with mixed feelings and a bit stable on the low scale… still! The last published BDTI (Dirties) and BCTI (Cleans) stood at 729 – plus eight and 501 – minus one respectively.

Containerships rates have in some cases improved particularly the period ones…. Early days though… but… the hope is still there!

The WTI just fell to US$ 74 from US$ 74.70 earlier on today. Once again we reiterate our view for the WTI to fall down, below the US$ 50 mark. CAUTION as you never ever know what we have warned you of having… Greediness has an end… like it or not…

…AND here you go with  VesselsValue’s latest research from Court Smith on the newbuilding sector:

 10 Billion USD Spent on Newbuilds in H1 2018

The enthusiasm for newbuild orders across most shipping markets has started to wane after over 10 billion dollars were committed in the first quarter of 2018. The total committed to new deliveries is now the lowest since the start of 2016. Ordering trends in the start of the year were highest in the markets that were seeing the highest returns. This includes the dry bulk and LNG carrier markets, while interest in the low earnings environment tanker markets was softer. In one sense this highlights the short-term view that some investors take of the market. It still appears to be easier to secure financing for ships in a strong market as opposed to those that are suffering in the doldrums.

Rising asking prices from shipyards are partially to blame in the downturn in new orders. Higher steel prices, smaller workforces, and less willingness by the yards creditors to accept low margins are contributing to lower buyer interest. The slowdown in newbuilds is an encouraging sign that over-ordering may not be a significant issue. Some of the market segments have a large outstanding orderbook, but most of these are offset by an equal number of ships on the water which are equal to their recycling value. If orders remain between the $4-$8bn dollar level through rest of the year it should support the asset values of younger ships as well.

The headwinds to global trade may give some owners pause in fleet renewal plans, especially in the container and dry bulk markets which would be directly impacted by the higher prices for consumer goods which would result from tariffs. However, most shipping markets appear to be at their trough level or improving, which should encourage more investor interest in newbuilds going forward. The shift in money being committed to the ships is a good reminder that the cyclical nature of the business remains intact.

The Geopolitical issues have become messy earlier than we anticipated!

The MIGRANTS issue for a start might even divide and break-up Europe, not just in a North / South lay-out scenario/divide, but beyond that. Italy becomes the stabling block so to speak… and rightly so! The USA also has grave issues with MIGRANTS particularly with the separations of parents and their children.

All in all, particularly in Europe with the MIGRANTS crossing over from Turkey and North Africa – mainly Libya, expect despicable phenomena to happen. What a palaver with the Politicians and Diplomats attitude to try NOW after at least six years of  Wars raging in Syria, Iraq, Afghanistan  and the mess in most of sub-Sahara countries to try now to find a solution. Pathetic morons, failed people with inhumane instincts; this is what they are!

Awaiting the Western Balkans meeting in London communique (hopefully) later on, The Wars in Syria and Iraq latest, BREXIT latest news too and all that we normally cover including the good news – all Thai boys safe but over 155 lost and more missing in Japan…

Now, with respect the latest rankings on Planet Ocean’s Shipping Centres I object as Piraeus maintains the real lead – all are focused on Piraeus and all happening do happen in Piraeus (Athens is though the names in the rankings…), London calls the shots being the Shipping world’s Administrative Shipping capital. As for the Middle East and Far East centres mentioned, these are pure politics… OK, fine, Singapore is coming up, Hong Kong, Dubai, Rotterdam, Hamburg, New York et al,  all for different reasons….

On another tone and note we are pleased to see  The Copenhagen Business School‘s Blue MBA on top at the latest rankings, which please read  here .-

Have a nice evening, enjoy the France  vs. Belgium semi for the World Cup 2018 in Russia and be on guard for any eventuality emanating from Pirates, Terrorists and Criminals of any kind wherever you are on Planet Ocean!

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