In the coming months ahead of the inaugural Geneva Dry event organised by Splash, we will be sitting down with key names attending the dry bulk mega summit. In the hot seat today: Edward Buttery.
Edward Buttery, CEO of London-listed dry bulk owner Taylor Maritime Investments and Grindrod Shipping, is both an optimist and a realist.
“We shouldn’t let recent disappointing short-term demand data overshadow supply data,” he tells Splash when being quizzed on what the dry bulk markets might look like come the May 2 start of Geneva Dry, less than eight months away.
No one can deny that 2023 has been disappointing for the fortunes of dry bulk owners, but for Buttery, there are grounds for optimism, not least in the key market of China.
“Despite persistent economic challenges providing a drag on demand, the recent de-stocking observed in China leads us to anticipate a resurgence in imports as part of a re-stocking program toward the end of this year, which should ultimately result in improved rates,” Buttery says.
Looking to 2024, the Taylor Maritime executive expects the usual softness over the Chinese New Year period followed by what he hopes will be a structural recovery in the Chinese economy.
In the rest of the world, macro factors that have hampered short-term demand require continued monitoring, Buttery advises though he expects the trend will be a softening interest rate environment at some point in the coming years and a gradual easing of lingering demand headwinds.
However, it is the supply side that excites Buttery the most.
“Supply of ships remains limited and, over the medium to long-term, this is what drives our market,” he says, noting how the dry bulk orderbook has been near multidecade lows, especially for his main focus, the geared dry bulk sector, and with the full-up nature of yards in Asia there’s no chance for this supply/demand equation to be dramatically altered until much later in the decade.
“With more than 9% of the fleet over 25 years old, the handysize segment, in particular, can expect scrapping to increase in coming years irrespective of market conditions,” says Buttery.
While conceding it’s less certain, the continued shifting of trade routes and formation of new trade blocs could, says Buttery, influence effective supply.
“With tonnage being tied up on longer duration trips, fleet utilisation increases,” Buttery points out, noting, for example, how the wider effect of Russia’s withdrawal from the Black Sea grain deal has seen grains flowing from further afield with a record crop in Brazil supplementing this supply.
Taylor Maritime Investments is a significant owner and tonnage provider of geared handysize and supra/ultramax dry bulk ships. It secured a controlling stake in Grindrod Shipping late last year
Buttery is one of 25 shipowners already signed up to attend next May’s Geneva Dry.
Taking place at the Hotel President Wilson on the shore of Lake Geneva, the high-level summit is designed to get every rung of the dry bulk supply chain involved.
Panels will bring together analysts, miners, traders and shipowners to discuss where the markets are headed with Buttery scheduled to participate in the minor bulks session. Other sessions include agri-commodities; coal; iron ore; and decarbonisation.
To find out more about Geneva Dry, click here.
