Confidence in chartering & shipping

Is the handy market getting similar to the coaster market? Becoming mainly a positional market (some would say technical market) with the main market driver being the match and balance in between ship position and cargoes requirements? Forgetting about what some would call fundamentals of the market. We got the feeling here, there could be quite big difference on money put on the table on similar ships for similar trade from one week to the other. It’s also difficult to count on index trends to give a real picture on what’s going on and where market is heading towards. Bad timing can easily lead to a 20% gap on the tce equivalent from one week to the other.

Talking about fundamentals of the market, you can have a look on the Oil prices on which OPEC’s struggling to control anything apparently with the barrel down below $46 and US Crude oil below $43.50. Confidence is lost in the oil world. When in the shipping world, confidence about a better market is going up and said as follow “Shipping confidence hits three-year high” from 5.6 recorded in the previous surgey held in Feb to 6.1 on the last results (out of 10.00). In details

  • Brokers confidence from 4.6 to 6.4
  • Owners confidence from 5.6 to 6.1
  • Charterers confidence from 5.9 to 6.4

I’m still struggling to make some conclusions on this results to be honest with you as I would naturally put the “confidence concept” from Owners point of view being probably the opposite as the “confidence concept” in charterers’ mind.

It’s also bit bizarre to have Owners confidence going up, thanks to 14% of the financial costs improvements when owners are well aware they’ll have to face few expensive upgrades on their ships in the coming months to fit in with the IMO regulation.

Also 52% of the respondant are betting BDI in a 12 months time being in between 1,000 to 1,499 when as a benchmark, in the past 12 months, 77% of the respondents are confident BDI will be in between 1,000 and 2,000.

BDI managed to be above the 1,000 point mark during 3 months in total (firstly from Nov 10th, 2016 to Dec 13th 2016 during 1 month, then from 7th March to 7th May with a peak at 1,324 on march 29th and the bottom at 580 on june 20th 2016, exactly one year ago.

Is this confidence concept, only an optimistic point of view and a state of mind to say “can’t be worth anyway”?

Shoud you want to check how confident you can be about my above comments, you can still go here and surely soon the full survey here (only last one available on line at the time of writting this)

And if you’re asking me, I’m really confident we shall be able at Pelagos to fix few ships and cargoes before month end (and let be crazy in the next 12 months). I’m also very confident readers of this report will keep giving us their good support. which is a good start, right?

Have a nice afternoon

Jerome

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