Dry CargoGreater China

Cautious optimism at Hong Kong dry bulk gathering

There was a mood of cautious optimism at today’s fifth annual SinoShip Dry Bulk Business Breakfast held in Hong Kong. Whereas last year’s gathering – also in November – was at a time when dry bulk was approaching its absolute nadir, this time around there was a feeling that now is the time to invest – for those that have access to cash and can withstand another tough 12 months.

The event, sponsored by DVB Bank and RightShip, brought many of the territory’s leading shipowners together to discuss key issues. There was a feeling among the panellists that the market might finally pick up in 2018. On the demand side, the resilient nature of the Chinese economy was unlikely to lose any speed in the coming 12 – 24 months. Supply remains the issue – and there was concern among the panellists that either private equity or Chinese state-backed lines might come in with a wave of new orders soon. The depreciation of the renminbi makes newbuild ships in China at historic lows, something that might tempt some to take the plunge.

Shipowners expecting some redress in the supply/demand scenario from ballast water management legislation and subsequent scrapping are in for a disappointment, attendees were told, as the US continues to fudge ballast water implementation.

Owners attending the event were sanguine about the recent sulphur cap ruling from IMO with most feeling that there would be enough low sulphur fuel available by the 2020 implementation of the ruling and that scrubbers were not the way to go. Any extra cost from the fuel would be passed on to customers.
Panellists at the breakfast were Julian Proctor from Tiger, KC Maritime’s Capt Vikrant Bhatia, Michael Birley from Langton Group and DVB’s Maarten Vis.

Any pick up in rates is unlikely to see a correlating rise in vessel prices, attendees were told.

On advice for how to navigate the coming 12 months, Tiger’s Proctor summed up, saying: “It’s last man standing.”

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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.
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