Is shipping all about politics and weather ?

Somehow yes. Our business being so much related to international relationship (by essence) any political decision, change can have tremendous impact in our business.

On the political part, today it’s « bye bye United Kingdom ». The path for a hard brexit seems to be the English choice according to Theresa May today’s speech. Not sure how this will impact our shipping industry you can still have a look at this document which was put in the air before the brit’s decided to vote for their « independance » toward Europe back in 2016 brexit & shipping

Knowing politics have the know how to impact weather (they like to believe it), weather is probably the second biggest element which is impacting our industry, especially for those of you trading/shipping mainly grains. When on one side, international relationships prospects are getting  colder and colder, the cold areas are getting warmer. Have a look at this information related to the Great Lakes market.ice? where? Further south, Argentina is going through severe drough which will surely have an impact on the grains crops in quantity, quality and timing. (see here raining cats and dogs (source @agsplayer)

Are index and value of our routes taking into account Politics and Weather ? Yes surely up to a certain extent. It’s still fairly hazardous to claim « hs3 is down because of severe drough in Argentina» … Focusing on handies, HS3 ex ECSA to Skaw Passero seems not to have reached her bottom yet (and we have to admit, once again, most of market players failed to predict this downturn. Today being at $9.850 it’s bringing back to end November value. When for your records, at his highest (end december 2016) this route was reaching close to $14.000 daily.

Willing to be positive ? just compare where the bhsi was at same time of the year in 2016 (15th jan precisely), BHSI was proudly @ 245 (today @ 451) and HS3 was @ 4.224

Focusing on ECSA again, just checking the basics ie comparing number of ships available vs number of cargoes (based on our database – handies – from spot until 31st jan)

  • 9 cargoes available for end jan with one being suitable for spot dates
  • 25 ships open in ECSA from spot until 31 jan (max 25yrs old, from 25 to 40kdwt)

Knowing of course, some ships are hidden and probably even more cargoes are being done off market.

To conclude on the ECSA market, it remains tough for owners to be able to reach more than $10’000 daily aps recalada on 32/35’000dwt. On index type ? Rumor that below US$ 9’000 aps has been conclude.

Wait and see for sunnier/hotter day ? Waiting has never paid the bills… so let’s keep movin’

Rgds

Jerome

 

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