John Faraclas
Markets struggle in the Sea of Uncertainty amid perplexed global chaos
The BDI (Baltic Dry Index) surpassed the 500 points threshold and now stands at 504, which is also two points higher from last week’s 498 points. Geopolitics, coupled with Recession and Coronavirus (COVID-19), is causing more than chaos and the clever dicks – politicians, economists and their cronies, do not have a leg to stand. John Faraclas’ daily and weekly recap:
So, the BDI managed to gain 15 points since yesterday and now stands at 504 points, which is also six points plus since last week’s 498 points (22/05)… If Shipping investments have to make sense particularly Tramp Shipping, the BDI must go over and above the 2,500 points; end of the story.-
The Capes’ BCI moved a bit higher at 46 points – 19 vital points plus; the weekly result though was catastrophic as 116 points were wiped out – from 162 on 22/05… Ultra caution should be observed…
The Panamaxes’ BPI was 34 points up at 754 and on a weekly basis 119 points higher since last week’s 635. Good to see our favourable size over and above the 700 level…
…“Hiccups” for the Supras’ BSI, now down two points at 500 flat… The weekly …result was a four points plus – up from 486 last week…
“Rise” for the Handies’ BHSI now at 271 – plus four points; the weekly surge though was 22 good points – from 249.
All in all we are still at low levels with respect the BDI, actually 2,000 points below the level we stressed above in para two!
Container Trade as well as Liner Shipping also appears with cracks…
The Wets once again with mixed feelings; the last published BDTI (Dirties) and BCTI (Cleans) stood at 713 – minus seven and 587 plus nine points respectively. Last week the Dirties stood at 735, that is 22 points down and the Cleans 579, up eight points respectively…
The WTI now reads US$ 35.13 which is US$ 1.88 higher from last Friday the 22 May 2020. C A U T I O N…
The Oil industry MUST come to terms with many issues as well as reality, above all HUMANE ones and equally respect the ENVIRONMENT – not just for 2020, 2030 and 2050 and their respective projections… Equally the other energy providers, Gas, LNG (is a fuel isn’t eh) etc., etc., MUST also “reason” with the situation… Enough from this kind of exploitations affecting directly the middle-man in the street as well as the independent non listed, in particular, shipowner – listed ones suffer too but the effect is not the same for Liner, G7 and Colonial originated shipowners; you dead well know what I mean..! No real interest for the preservation of the Environment where we had some good references as with the Coronavirus (COVID-19) anathema emissions where down… We repeat again as above that LNG is a fuel. So we insist in the Alternative Sources of Energy…
Many “object” to our prediction that Shipping becomes slowly, but steadily, Shipping for the very very very few… Well, they better see how many shipowners existed in the pre-1967 crisis with the closure of the Suez Canal (the tanker size revolutionising trade), the period leading to the 1979-1980 market improvement. The volume of bulk cargoes – dry and wets increases, needless to say the containers, but shipowning companies’ number decreases… During the collapse of 2008 many good shipping companies vanished… In 1979 there were 400 shipbroking houses as well as 400 banks and financial institutions lending money. Wonder how many from both sectors are still around, save some mega merger bringing the end of small to medium houses… Many shipping names, traditional and non-traditional ones vanished too… Over-regulation and over-capacity were reasons for the market’s downfall as well as new kids in the block following the collapse of the Eastern Block, the rise of China and obviously now, as we speak, the deepest Recession humanity will ever witness… Protectionism and State owned groups might secure the continuation of the supply chain… Never ignore what happens in Aviation. In three months now, due to the Coronavirus anathema, 98 (ninety-eight) centum of Airlines collapsed… The Cruise Industry is in limbo… Many countries faced collapse and many more are heading to… Finally add the Global debt, now going over and above the US$ 260 (twohundredandsixty) trillion mark and see what you get; hence our response: “All change please! We are running out of time and money, unless we “borrow time” and “print money”… the other day which was well received by many all over… THANK YOU ALL!!!
The Geopolitical situation is getting worse:
MIGRANTS, the number one issue… gets worse and as the summer period approaches you won’t believe what might happen with Turkey’s president Erdogan threatening to allow them cross over to the Greek Islands and mainland Greece… In Libya too, and given the escalation there, more will attempt to cross over to Italy and its Islands… The European Union MUST intervene – as well as NATO before things get worse; already off hand… It is too much nonsense to digest the excuse that MIGRANTS come from war-torn Syria, they come mainly from Afghanistan, Pakistan, Iran, Iraq and Africa’s sub-Saharan region too… We remind you also the issues MIGRANTS cause in the designated areas / hot spots in Greece and the alarming incidents in Malakasa, North of Athens, Greece. Don’ ask what happens in the Greek Islands and elsewhere in combination with the Coronavirus (COVID-19) pandemic! CAUTION!
Turkey escalates its provocations against Greece and Cyprus – both being EU membeer States, and today president Erdogan went over the top; 29 (twentynine) violations by Turkey’s Airforce F-16’s, a spy plane radar and helicopters over the Aegean Sea and Greek Islands and a violation inside Saint Sophia Church with readings from the Koran and fiestas outside, both events coinciding with the occupation of Constantinople on the 29th of May 1453, 567 years ago… The European Union abstains completely in reprimanding Erdogan and one day will pay the damage; wait and see. ENOUGH!!!! CAUTION once again per our past reminders, as you never ever know what might happen in this region – which is part of the faulty line from Gib to Afghanistan and from the Caucuses to the Horn of Africa and as Turkey opened another front in Libya – and develops further mess there despite Arms Embargo etc etc, and together with the Syrian mess still on, what might come out of it. You can add also Turkey’s bankruptcy which might prompt Erdogan’s desperation and make it more messy… Russia too for its own designs endorses some of Turkey’s actions – see its Libyan actions.
Coronavirus as said before in our four months of coverage, introduces another way of life; survival only of the most disciplined ones!!!! Ensure you understand what is happening and how Coronavirus evolves…. See the South Hemisphere’s Coronavirus surge.
BREXIT remains quiet….
The European Union MUST get its act together as more money are needed to cover is main issues: MIGRANTS, poverty and unemployment amid this new Recession (Begun last year). Add the Coronavirus effect and see what you get… No coherent policy exists so far whilst there should have been a EU Directive on Health…
At the other side of the Atlantic the Minneapolis’ death of a black American sparks unrest across the USA in a much NON-NEEDED time with the Coronavirus mess there and the forthcoming presidential elections in November…
No change in the Central and South Latin America; CAUTION! All things being equal I am very much concerned what will happen in the event of a social unrest…
Africa remains pretty much the same… A big CAUTION there..
The Subcontinent too is trying to come up with a solution of its chronic problems and this Recession isn’t what the people there expected…. Again: CAUTION
China is being cornered and let’s see how the Chinese react with the current situation on Coronavirus and the accusations by the USA and the Hong Kong developments….
Australia and New Zealand continue to live in another world. Australia is now witnessing the “Release of the Palace Letters’ “ campaign effect and let’s see up to which point the authorities there will finally reach….
On the Coronavirus continuous despicable developments and uncertainty, ultra-CAUTION should be observed. In the absence of medicines, and the manna from havens vaccine, as well as the “existance” of an undisciplined global public, all things being equal, expect the unexpected with asymmetrical repercussions for all nations. Relaxing travel between some countries, allowing people back to work and opening of Schools (see what will happened in South Korea as we are monitoring a few counties very closely on many issues…), Colleges and Universities, was in our humble view a move too fast, very naïve if I may say so, given the surge of Coronavirus in the Southern Hemisphere and still a state of uncertainty in the Northern one… All this is to “avoid” further global economic losses… ignoring the fac that we are living in a bankrupt Planet Ocean amid a super Recession! What will happen in the G7 meeting in the USA in June? Wonder who will be accountable if “something” wrong happens… The Tourist industry in its entirety wants to open up, but… how safe this is from the tourists themselves in being disciplined and obeying / performing the procedures and protocols and how hoteliers and others equally perform verbatim the protocols… Same applies for all means of Transport… The Cruise Industry in limbo… Indeed the lockdown was a difficult decision but as things developed, a safe one…
In a nutshell, Coronavirus will be survival only of the most disciplined ones!!!! Ensure you understand what is happening and how Coronavirus evolves… Until now the deah toll is just over 365,000 and 6 (six) million cases… Frightening…
Have a nice evening and weekend remaining on guard from actions emanating from Pirates, Terrorists, Criminals and any Business Hooligans whatsoever wherever you are on Planet Ocean. Once again a big THANK YOU to all who really care for all humans – Doctors, Nurses, Seafarers, Dockers, Port Authorities et al during this Coronavirus disaster!! We repeat: Do please invest in Hospitals including Equipment, Doctors, Nurses and any useful means to avoid further disasters! Become more disciplined and care for the Environment too. Lastly: Education and Training for all to be able to tackle these disasters. Lets work collectively together!
