Never a dull read, Thai-listed Precious Shipping’s 26-page annual report, out yesterday and penned by veteran managing director Khalid Hashim, contains plenty of key messages.
The dry bulk owner saw its net loss grow THB2.66bn ($75.93m), from THB 2.42bn in 2015 on the back of taking a THB680m hit from disposing of 13 ships. Precious described 2016 as “the worst year ever for dry bulk shipping”, noting how the annual average BDI at 673 was 42 points or about 6% lower than the lowest annual average in history of 715 points reached in 1986.
Overall, Precious said 2017 would be similar to 2016 with a lower Q1 followed by improvements during the rest of the year provided, the Thai owner stressed, shipowners scrap their older tonnage throughout 2017 as quickly, and in as large numbers, as they did in the first half of last year.
“If scrapping doesn’t get off the back burner, then we may experience pain, not just in Q1, but during the whole of 2017,” Precious warned.
Noting how time charter rates had picked up to “semireasonable” levels by the end of last year and there was an argument that the supply demand balance is “not that far away”.
“It is now almost 9 years since the dry bulk markets have been in a crisis. Even the scriptures forecast a maximum of 7 years of ‘famine’ so hopefully we have seen the last of the ‘lean’ years,” the wry report quipped.
Khalid Hashim is one of the speakers lined up among a stellar cast of shipowners for the forthcoming Maritime CEO Forum on April 24 at the Fullerton Hotel in Singapore.