Global Maritime Investments: Bulk downturn far from over

 

London: The boss of the one of the largest privately-owned freight trading groups in the world warns Maritime CEO readers today that the downturn in dry bulk is far from over. While some investment banks, notably Norway’s DNB, have proclaimed the worst is over, Steve Rodley, managing partner of Global Maritime Investments, is far from convinced. 
 
Rodley reckons dry bulk is now in the “lower regions” of the cycle but not the bottom. Critically, he expects current levels – and lower – to be maintained for some time.
 
“The extent to which the oversupply issue is impacting the dry bulk market has never been seen before,” he explained, “and an extended period of true demand expansion – by true we mean new infrastructure/new mining etc globally to add significant seaborne tonnes plus an extended period of scrapping and low ordering will be required to improve rates to any great extent.”
 
GMI does not see this happening at strong enough levels on either the demand or supply side for some time and even then the impact will take time “to flush through and impact rates” Rodley said.
 
The GMI boss cited four key elements as vital for getting through the current difficult times for shipping: risk management, hedging price risk, credit/counterparty risk controls and efficient operations.
 
GMI operates between 60 to 80 bulk carriers. Typically two thirds of these are panamaxes with the balance split between capesizes and supramaxes.
 
Looking ahead, Rodley revealed plans to expand the company’s longer period charter fleet as well as get more into vessel ownership.
 
Last September, GMI hooked up with Cardiff-based Graig Group to provide Chinese shipyards with safe havens and tailor-made solutions for problematic deliveries. Working together, the two groups provide yards with employment and management for vessels which have been built but which cannot be delivered to the owner. It is an area Rodley can see expanding.
 
“We continue to grow in China and plan to do so in the coming years,” he said.  [06/02/13]
 
RELATED STORY: (click on headline to read)

Related Posts