- Index publication: Easter Holiday arrangements
Due to UK public holidays, the Baltic Exchange will not be publishing its Dry, Tanker (including LPG), Sale & Purchase or Demolition Assessments on Friday 30 March and Monday 2 April 2018.
There will also be no publication of FFA volumes, Dry Option Volume Estimates or Baltic Forward Assessment curves (dry & wet) on both these dates.
All indices including Sale & Purchase Assessments, Demolition Assessments, FFA volumes and estimates and BFA curves will be published on Tuesday 3 April 2018.
Also please note that due to a Singapore public holiday, the Baltic Exchange will not be publishing its BEP-Asia, BES-Asia and BITR-Asia, on Friday 30 March 2018.
BEP-Asia, BES-Asia and BITR-Asia will be published again on Monday 2 April 2018.
Questions and comments should be directed to firstname.lastname@example.org
To view all 2018 non-publication dates click here.
- Shanghai Movie Night at La Queue Du Chiot
On 12 April the Baltic Exchange will be holding a movie night at La Queue Du Chiot, Shanghai. The movie screening begins at 19:30 with light refreshments from 18:30.
This event is complimentary for all Baltic members who have registered in advance (CNY100 on the door).
You can reserve your place by contacting Ying at +86 138 1767 0246 or Amy at +86 138 1789 2665. Alternatively, you can send your RSVPs to email@example.com.
All RSVPs should be made by 11 April 2018, 1700hrs.
Please note that there is limited seating and will be on a first come first serve basis.
- Book now: Chairman’s Cocktail Party
Tickets are now available for the Baltic Exchange Chairman’s Cocktail Party on 9 May.
This spectacular event, attended last year by over 600 people, is the highlight of the Baltic’s social calendar and will once again take place at London’s Christ Church, Spitalfields.
Members are invited to buy tickets for their guests via this link.
- Baltic Exchange Risk Forum: Posidonia
Held in conjunction with Posidonia 2018, this key event brings together participants in the freight and commodities markets for a series of presentations and discussions on where risks in the markets are, in addition to developments and opportunities going forward.
Further details of the programme will be circulated in the next few weeks, together with information on how to register.
Click here to view the flyer
- Making headwinds in Hamburg
You cannot go far in the shipping world today before coming up against the “d word”: “disruption”. The advent of new technologies, coupled with geopolitical developments and environmental concerns, means that the industry today looks incredibly different to how it appeared 10 years ago, with companies in the sector now having to adapt their practices in order to match up to the shipping environment as it currently stands.
Yet, despite this being an unpredictable, tumultuous era, those with an idea for a service and the know-how have the potential to make a success of a business venture in the sector. At Marine Money’s 17th Annual German Ship Finance Forum, held in Hamburg in early March, new companies, all connected to Hamburg in some form, were given the opportunity to make elevator pitches to the assembled audience about what they could offer shipping customers. Tasked with describing their value propositions in three minutes or less were digital maritime investment platform Marvest, blockchain-underpinned marketplace HHX.blue, vessel auction website VesselBid and digital ship-trading platform Shipstock/Demogate.
First on the agenda was Marvest. The Hamburg-registered company is working, according to co-founder and managing director Nikolaus Reus, on “a digital investment platform for professionals and for retail investors to invest again into shipping assets”. Mr Reus said the collapse of the Kommanditgesellschaft (KG) funds markets, with a significant form of capital having been eliminated for shipowners, got the company thinking.
“We were thinking about an idea: how can we bring again shipping projects [to] respective investors — and in what kind of way and with what kind of product?” he explained. “So we came up with an idea to develop a digital investment platform which is based on an algorithm that standardises and digitalises the reporting process, the investor relation process, and especially — this is where we add the value — the investment process.”
New companies, all connected to Hamburg in some form, were given the opportunity to make elevator pitches to the assembled audience
After a due diligence process, an asset gets presented on the Marvest platform with all relevant details, including the period of the loan, the volume the company raises for the shipowner and the product. The firm has developed two products: a fixed-interest loan, and a loan with a lower fixed interest, but with an equity kick on top. Mr Reus said the latter option gives flexibility to the shipowner and offers different investment strategies for a company’s investors. Marvest wants to target smaller, niche sectors: for example, the container-feeder segment, the bulk handysize and supramax segment and also, MPP, C Types and F Types.
Next on the agenda was HHX.blue, whose also wants to offer “new solutions for ship finance”. Headquartered in Hamburg, the start-up is still being established, but the company claims that the organisation’s goal is “to connect borrower and lender in the maritime industry in the easiest and most-efficient way”. Pitching the company to the audience at the Marine Money Forum in Hamburg, Olaf Danckwerts, a partner in the firm, said that the company wanted to create a market or digital loan platform that permits, in the first instance, access for shipowners for new lending capacity. The second step is letting investors obtain proper access to the shipping sector based on a high quality of data.
“The market will be able to offer for the shipowners, and also for the investors, a reliable process, high market-transparency on both sides — and all this would take place on a bankable standard, so therefore we will create an expert network. This will be highly efficient, and, of course, it will cost less than comparable financial advising,” said Mr Danckwerts.
The third firm to give a pitch at the Forum was VesselBid, an associated company of NetBid Industrie-Auktionen (NetBid), or NetBid Industrial Auctions. Also headquartered in Hamburg, NetBid is an online auction house that hosts sales and auctions of used machinery, equipment and entire production infrastructure. According to the VesselBid website, NetBid’s permanent interest in expanding and adapting for customers meant it set up VesselBid to sell and auction ships. Most of the second-hand vessels on offer have come on to the market because of bankruptcies or financial troubles — though direct sellers are welcome to approach the company and make use of its knowledge and network.
“Our business model is relatively simple: we have online sale and auction of vessels — containers, bulkers, tankers and general cargo multipurpose vessels,” said NetBid chief executive and VesselBid partner Clemens Fritzen, explaining the company. “But, for sure, we are not a pure e-commerce company. The concept is to extend our successful business model … by combining brokerage, market expertise and IT technology. That’s our unique selling point.”
VesselBid said that NetBid has collaborated with an unnamed sale and purchase broker and a leading German maritime lawyer for the new company, with the concept being to offer transparent vending and pricing for sellers and buyers. At the Forum, Mr Fritzen said that the subsidiary’s auctions have greater sale prices because of a transparent bidding process and that the company is not backed by any shipowners or banks. Price bidding only takes places online, visible to both buyers and sellers. During his pitch, the NetBid chief executive said that test auctions have taken place and that, recently, VesselBid had its first positive test-run, representing a German financial institution. At the time of writing, a containership was up for sale on the ship auction site.
The final pitch was given by ShipStock/Demogate in a presentation given by Henning Martin, co-founder. Mr Martin described ShipStock as “a digital transformation project and shipbroking platform in the sale and purchase segment that offers sellers full control and transparency of the sales process”. Demogate is an online tool for buying and selling old container vessels.
“As ShipStock and Demogate, we are developing a variety of very exciting tools, like a contract-editor, a fleet valuation management system and an auction tool for demolition sales, as well as further analytical tools and financial key performance indicators that you can easily monitor on the platform and that will increase the quality of your decisions,” he said. “So for us, it’s not about changing things, it’s about improving things and making your life easier and your business more efficient.”
- Taking action on emissions
With the 72nd session of the International Maritime Organization’s (IMO) Marine Environment Protection Committee (MEPC) due to take place in London from April 9 to 13, attention will be focused on the ruminations of the United Nations’ agency next week.
Pre-emptively, the International Chamber of Shipping — the world’s major trade association for merchant shipowners and operators — has called on governments to compromise at the meeting to help the IMO agree an ambitious roadmap for further reducing carbon dioxide (CO2) emissions from shipping to meet the Paris Agreement’s expectations.
“Governments on all sides of the debate are going to need to show far more willingness to compromise on their current positions or put at risk an agreement on a meaningful strategy,” International Chamber of Shipping (ICS) chairman Esben Poulsson said. “This would greatly undermine the authority of IMO and the future sustainability of the shipping industry. Agreement upon a mid-century objective for the total reduction of CO2 emissions by the sector, regardless of trade growth, will be vital to discourage unilateral action and to provide the signal needed to stimulate the development of zero-CO2 fuels. But the very high level of ambition proposed by certain EU Member States — a 70% to 100% total cut in emissions before 2050 — is unlikely to achieve consensus support.”
According to a briefing note, the ICS indicates that a major improvement in ship efficiency — “over ‘business as usual’” — would be necessary if the IMO set a preliminary goal of lowering shipping’s total CO2 emissions by half, for example, rather than 70% to 100%. This would still only be possible with the widespread use of zero-CO2 fuels, the ICS said, taking account of maritime trade’s expected growth.
Shipping could be responsible for 17% of global greenhouse gas emissions by 2050 if left unregulated
“A mid-century objective similar to that proposed by Japan — which might also enjoy support from nations like China if EU nations were willing to compromise — would still provide a compelling signal to the industry,” Mr Poulsson explained. “This should also be sufficient to stimulate the development of zero-CO2 fuels, leading to a 100% CO2 reduction in line with the ambitious vision which IMO must agree.”
Previously, both the ICS and other industry associations have made it clear that removing all CO2 emissions from international shipping sometime between 2050 and 2100, or as soon as global availability of zero-CO2 fuels allows for this, is the ultimate aim. In advance of these types of fuels becoming widely available, shipping, the ICS claimed, has additionally proposed that the IMO should adopt the targets of maintaining world shipping’s annual total CO2 emissions below 2008 levels; decreasing CO2 emissions per tonne-km, as an average across global shipping, by at least half by 2050 compared to 2008; and reducing international shipping’s total annual CO2 emissions by an agreed percentage by 2050, compared with 2008, as a point on a continuing trajectory of CO2 emissions-lowering.
Time to get tough
Reducing CO2 emissions from the international shipping industry is an important task. The dirty, low-grade fossil fuels that are used to power ships make vessels major contributors to world air pollution, with the Third IMO GHG Study 2014 showing that maritime transport emits about 1,000m tonnes of CO2 each year. This form of carriage, according to the report, makes up around 2.5% of global greenhouse gas (GHG) emissions. Looking ahead, emissions from shipping are anticipated to go up between 50% and 250% by 2050 (depending on future economic and energy developments), the European Commission claims.
Beyond the idea that the shipping industry is not doing enough to tackle the pollutants it releases, it has been argued that the sector has consciously fought against efforts to limit damage. In October 2017, non-profit organisation InfluenceMap, which looks at the degree to which corporations influence climate policy and legislation, released a report that claimed shipping had “aggressively lobbied” the IMO to obstruct climate change action for shipping, maintaining its status as the planet’s only sector not currently governed by any emissions decreasing measures. The document took aim at the ICS, claiming it had spearheaded efforts to oppose climate change action at the IMO. It said that this chamber, BIMCO and the World Shipping Council (WSC) had together lobbied to push back implementing any climate legislation until 2023 and, on top of this, only supported voluntary regulations that might not decrease shipping’s overall GHG emissions.
“Despite being responsible for close to 3% of global greenhouse gas emissions, the shipping sector remains outside of the UN Paris Climate Agreement,” InfluenceMap said. “A 2015 European Parliament report estimated that shipping could be responsible for 17% of global greenhouse gas emissions by 2050 if left unregulated, potentially jeopardising global ambitions set out under the Paris Agreement.”
The organisations fought back against the allegations. The ICS said that the amount of documents submitted by industry in advance of meetings showed how seriously it took cutting shipping’s CO2 emissions, while the WSC claimed it “‘[offered] concrete [proposals] for both short- and long-term carbon-reductions’”, noting a climate action policy submission, (MEPC) 71/7/4, that it co-submitted previously in 2017. IMO’s secretary general, Kitack Lim, said that the “participation of organisations representing so many viewpoints [provided] a balance that [added] considerably to the credibility of the Organization’s overall output”. The IMO Assembly’s strategic plan for 2018 to 2023, adopted in late 2017, included the strategic direction of “developing appropriate, ambitious and realistic solutions to minimise shipping’s contribution to air pollution and its impact on climate change”.
At the 72nd MEPC session, chaired by Japan’s Hideaki Saito, it is expected that the assembly will adopt an initial strategy on lowering vessels’ GHG emissions. According to the IMO, this will be a framework for member states, anticipated to lay out the future vision for world shipping, ambition levels for decreasing GHG emissions and guiding principles. It will include further actions for the short-, mid- and long-term, along with potential timelines and their effect on states, plus barriers and supportive steps like capacity building, research and development and technical co-operation.
The Intersessional Working Group on Reduction of GHG Emissions from Ships, which will have its third meeting in early April, is expected to finalise the draft initial strategy text and give a report to MEPC 72. Moreover, at the 72nd session, the committee is expected to create a working group for GHG reduction from ships, as well as looking at vessel energy-efficiency and the non-mandatory data collection system regarding ships’ fuel oil consumption. Wider topics to feature at the session will include marine litter, implementing the sulphur 2020 limit, implementation of the ballast water management treaty and measures to decrease the risks of using and carrying heavy fuel oil as fuel by vessels in the Arctic.
Given the clear indications that more needs to be done to cut the use of harmful fuels in shipping, it seems this session cannot come a moment too soon.
- Freight & Commodities Forum: Singapore
On 25 April, the Baltic Exchange will be hosting its annual Freight and Commodities Forum during the Singapore Maritime Week 2018. The focus will be on the dry market and bulk commodity outlook, as well as announcing updates on Baltic member services and initiatives.
New speakers confirmed include Dr Martin Stopford, President of Clarksons Research and Ian Roper, General Manager of Shanghai Metals Market (SMM), Singapore. The Forum will also feature presentations and open discussions on new Baltic initiatives, market benchmarks and the impact of 2020 Sulphur Cap on the freight market.
- Member update
The following individuals have applied for Membership of an existing member company:
Company Individual Clarksons Platou Futures Limited Mr Callum Bunce Mr S Butler Mr C Nunn Devbulk Trading Limited Mr P J Banks Riverlake Shipping Limited Mr D Theis Ultrabulk Shipping A/S Mr J Lofqvist Koch Supply & Trading LP Mr E D Carrithers Barry Rogliano Salles Mr J H Stone
The following individuals have applied retired from membership:
Mr C A Colclough
Mr R N Thomas
Any comments should be passed to Karen Karanicholas by 4 April 2018.
- Join the Lord Mayor’s Big Curry Lunch
The Baltic is looking to have a bigger than ever presence at the 11th annual Lord Mayor’s Big Curry Lunch at London’s Guildhall on Wednesday 11 April 2018.
The Lunch supports members of Her Majesty’s Armed Forces and Veterans who have served in Iraq and Afghanistan through the British Army’s national charity ABF The Soldiers’ Charity and in association with The Royal Navy and Royal Marines Charity and The Royal Air Force Benevolent Fund.
Hosted by the Lord Mayor of the City of London, the event has contributed over £1.7m to The Soldiers’ Charity since 2008.
Tickets are £100, which includes unlimited curry, beer and wine. The Lunch will begin at midday, and there will be three lunch sittings, at 12.30pm, 1.15pm, 2.00pm. It will finish at 3.00pm.
Click here to purchase tickets.
- SCMA-KSA Korea Conference 2018
The jointly organised Singapore Chamber of Maritime Arbitration (SCMA) and Korean Shipowners’ Association (KSA) Korea Conference 2018 will take place on 5 April at the Hotel President, Seoul.
The event showcases how leading practitioners interpret the developments of maritime arbitration in Singapore and Korea and their experiences on effectively handling shipping disputes.
Speakers at this year’s conference include:
Benjamin Hughes: Independent Arbitrator / Professor, Seoul National University Law School
Lawrence Teh: Senior Partner, Dentons Rodyk & Davidson LLP
Captain Kim In‑Hyeon: Professor, Korea University School of Law
Chung Byung‑Suk: Attorney, Kim & Chang
Kim Jun-Hee: Partner, White & Case
For more details, view the flyer here.