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DRYBULKOUTLOOKMARINEMONEYGULFFORUM
7TH MARCH2017
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• DryCargoMarkets- Overview
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• Sowhytheoptimism..
• ,NewBuildings Thereportedordersfortheentire2016were24VLOCs,1Capesize,2Panamaxes,5Supramaxes,and6Handysizes.NoordersinJan 2017
Demolition Thereporteddemolitions for2016wereabout376shipstotalingabout30mndwt.Jan2017saw21unitstotaling2mn dwtdemolished.
VesselValue NewBuildingpricesarestagnant, losing8-10pct yoy.Secondhandprices&transactionsincreasing– 71unitsinJan2017!
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• Demand– CommodityPrices• Coal,Ironorepriceshavesurges2nd half2016,boostingfreightsentiments
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- FFAs
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• BUT..• WillChinacontinuethebullrun?
- OROBFUELINGDEMAND,BUTUSD188BNCAPITALOUTFLOWIN2016- YUANDEPRECIATION/HIGHDEBTTOGDPRATIO- POSSIBLETRADEWARWITHUS?
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• USD&‘Trump’card• Lasttwoshipping‘crisis’wereFINANCIALCRISISandweremoresevereandlongerthanearlier‘shippingevent
drivencrisis’
• USDStillthedominantcurrencyforglobaltrade– nearly41%ofglobaltransfersinUSD• 2012/2013‘MarketRecovery’influencedbyQEbyUSFed(QE1/QE2/QE3- 3.5tnUSD)• ’TrumpFactor’– ‘Importadjustmenttax– Bordertax’/AppreciationofUSDbyover25%!• "Thesizeofdollarappreciationandthetimeframeoverwhichadjustmenttakesplaceareuncertain,eventhoughintheorytheproposed20%border
taxcouldresultinanimmediateandpermanentnominalappreciationofthedollarby25%”- Moodys
Globalization’Eventbased’
‘Financial’
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• Trade&Marketimbalances
• Grainseasonality• Chinesecoastalcoal&coalimporttrade- impactonsupras• Indiancoalimports• Chineseironoreimports• Demolitionlinkedtomarkets– lowdemowhenmarketsrecover• Bunkerprices– slowsteaming
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BackupSlides
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ChinaCoastalCoalShipment
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