AsiaDry Cargo

Maritime CEO Forum: Banchero Costa’s dry bulk warning

Ralph Leszczynski, global head of research at Banchero Costa, took the hot seat for the opening quickfire Q&A markets salvo at yesterday’s Maritime CEO Forum held at the Fullerton Hotel in Singapore, using the platform to warn dry bulk owners that 2019 will remain a very tricky year.

Citing the series of disasters that have hit miners so far this year as a “string of unfortunate black swans” Leszczynski said he expects rates to pick up in the second half for bulkers but for the year as a whole to not surpass 2018’s performance. Leszczynski said it was still to early to assess just how much Brazilian miner Vale’s woes over the past three months would actually take cargoes out of the market.

Leszczynski was more bullish for tankers, after strong demolition seen in the sector last year with the most amount of VLCCs scrapped for 30 years. The impending IMO 2020 sulphur cap should provide a “positive spin” for both crude and product tankers, the Banchero Costa analyst suggested.

On the sulphur cap, Leszczynski said he was anticipating chaos at the start of next year as a majority of owners will leave planning to the last minute. “From a logistics point of view it will be a mess,” Leszczynski predicted, suggesting that many owners will play it safe in the first months of the cap’s implementation by using more expensive gasoil.

On topical geopolitical issues, Leszczynski said he was optimistic that a solution to the US-China trade spat would be found soon. The silver lining from the trade tit-for-tat, Leszczynski said, was that in order for China to reduce its trade deficit it could end up buying more commodities such as coal and oil from the US.

A full report on the analyst session will appear in the next issue of Maritime CEO magazine. Splash will be carrying brief reports from each session all week.

Maritime CEO Forum Singapore is sponsored by AVS Global Ship Supply, Cobham, Cockett Marine Oil, Dualog, Inmarsat, Liberian Registry, Lloyd’s Register, Marlink, ShipServ, Veritas Petroleum Services and Wilhelmsen Ship Management.

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