Dry bulk shipping ought to prepare for a long period of higher risk levels, warns the chief operating officer of one of Singapore’s fastest growing operators in the sector today.
Lukasz Ogryczak is COO at Omegra Shipping, a seven-year-old entity that sits alongside sister company and commodity trading house, Enerfo.
In the short term he is anticipating freight rates to strengthen in the final quarter of the year, with a spike predicted at some point in November or December.
More long term, Ogryczak says: “Shipowners and operators may need to get used to prolonged periods of time where the market will offer earnings below the financial breakeven point for the global fleet, but we will also face unforeseen spikes in freight rates and I expect these spikes to intensify both in strength and frequency.”
In the past year Omegra’s operated fleet has fluctuated between 10 to 38 vessels while preserving an underlying growth and staying profitable.
As the dry cargo market peaked in September 2019 Omegra was operating 38 vessels – an all-time capacity record for the company. However, the market subsequently went into headwind and by January Omegra had reduced its capacity to just 10 vessels or a 75% reduction in its fleet over just three months.
Two months later Omegra had repositioned its activities for the South American grain season and the operated fleet counted 26 vessels.
Then came the coronavirus outbreak and once again the company was on what Ogryczak describes as an “adjust and adapt mission”.
The significant changes in fleet size has however not led Omegra off its underlying expanding course. Measured by shipdays the activity was up by 15% year-on-year during the second quarter of 2020 and for the 12 months ending June 2020 Omegra had increased its activities by 27% compared to the same period last year.