Splash 247

A third of cape brokers worldwide face the chop

A third of cape brokers worldwide face the chop

Array
(
    [0] => WP_Term Object
        (
            [term_id] => 57
            [name] => Dry Cargo
            [slug] => dry-cargo
            [term_group] => 0
            [term_taxonomy_id] => 57
            [taxonomy] => category
            [description] => Stay updated on what's going on in the Dry Cargo sector while browsing the Dry Cargo news archive. 

Find the latest maritime and shipping news on Splash 24/7.
            [parent] => 54
            [count] => 2198
            [filter] => raw
            [cat_ID] => 57
            [category_count] => 2198
            [category_description] => Stay updated on what's going on in the Dry Cargo sector while browsing the Dry Cargo news archive. 

Find the latest maritime and shipping news on Splash 24/7.
            [cat_name] => Dry Cargo
            [category_nicename] => dry-cargo
            [category_parent] => 54
        )

    [1] => WP_Term Object
        (
            [term_id] => 68
            [name] => Operations
            [slug] => operations
            [term_group] => 0
            [term_taxonomy_id] => 68
            [taxonomy] => category
            [description] => Stay updated on what's going on in the maritime and shipping operations areas by browsing the operations news archive. Find the latest news about all the things maritime on Splash 24/7.

Get the updated list of the latest news about operations. Browse Splash 24/7 for more maritime and shipping news.

            [parent] => 54
            [count] => 2057
            [filter] => raw
            [cat_ID] => 68
            [category_count] => 2057
            [category_description] => Stay updated on what's going on in the maritime and shipping operations areas by browsing the operations news archive. Find the latest news about all the things maritime on Splash 24/7.

Get the updated list of the latest news about operations. Browse Splash 24/7 for more maritime and shipping news.

            [cat_name] => Operations
            [category_nicename] => operations
            [category_parent] => 54
        )

)

Should capesize brokers be mulling a new career? Up to a third of them could be replaced by online platforms, suggests analysts at Alphabulk in their most recent weekly report.

The future of shipbroking in the digital era has been the source of much conjecture and many articles on this site this year, much of it stemming from news that miner BHP Billiton has from this January been booking iron ore freight via its own new platform, eschewing the need for brokers.

Alphabulk reports BHP Billiton is close to sealing its 100th iron ore cargo, and has just concluded its first coal cargo deal

“Many other initiatives are underway, so suddenly there is a sombre mood percolating through the rank and file in ship brokerage. Is a massive cull on its way?” Alphabulk analysts mused.

Alphabulk reckons a third of capesize charter deals will end up being done online in the coming three to five years, theoretically making a third of the world’s capesize brokers potentially redundant.

Alphabulk said the damage would be most felt in the six cities where together 35% of all shipbrokers live and work: London, Singapore, Oslo, Geneva, Copenhagen and Paris.

Share this article

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

Related Posts

4 Comments

  1. Martin Rowe
    October 6, 2017 at 1:47 am

    Alphabulk’s analysis is based on a false premise. Whilst there may be a finite amount of cape cargos there aren’t a finite amount of cape fixtures; in a firming market Vessels may typically be re-let several times to the extent that the same operator’s name may feature more than once in a chain. Additionally those that control the tonnage will typically hold back from fixing in a hot market until the last possible moment. An inert non-proactive web platform trying to hosting a ‘Dutch auction’ in times where demand for tonnage exceeds supply will inevitably play 2nd fiddle to a broker seeking to cover the requirement.

  2. Sam Chambers
    Sam Chambers
    October 6, 2017 at 4:43 am

    A broker speaks! Thanks, Martin!

  3. Hans Stoger
    October 6, 2017 at 1:28 pm

    excellent comment by Martin Rowe – with the cape size index now going north of USD 20,000 per day the web platform may be a tool of the past (the very low market) – When capes are in short supply (remember when they hit USD 200,000 per day ) owners will fix the traditional way – as long as the owners make good money they don’t usually mind the brokers earning a good commission – what BHP seems to forget is that they are not the ones paying the commission , the owner pays the commission and in a high market the shipowner will decide how his ships are fixed
    sincerely Hans in Montreal

  4. Petra Voss
    October 8, 2017 at 6:58 pm

    Whilst I am not too familiar with the cape markets, I remember that some 20 years ago Cargill tried
    the same, ie. asking owners to go into “auctions” on their website. I think that idea was put to rest.

    Having operated and chartered ships out in all kinds of sizes I felt it was too much of a hassle,
    if all trading houses would implement this. Everyday to log on to each trading house website is a bit
    too much.

    petra