- The Chairman’s Cocktail Party
One of the standout events of the Baltic calendar, the Chairman’s Cocktail Party, will take place this year on Wednesday 15 May.
Attended by 600 guests, this historic event originally celebrated the end of a Baltic chairman’s two year tenure, held on the floor of the old Baltic Exchange. Now held at Christ Church Spitalfields in London, it brings Baltic members from across the globe together for a unique annual networking and social event, which is also attended by politicians, industry leaders and journalists amongst others.
Baltic Exchange Chairman, Duncan Dunn, will undertake the customary speech, presenting the David Bradley Cup to the 2018 winners, The Baltic Exchange, as well as reviewing another eventful year.
For those interested in attending, we suggest securing your tickets early by following this link to ensure you don’t miss this great occasion.
For pictures from last years event, click here.
- Passing of former Baltic Chairman, Hugh McCoy
Members will learn with deep regret of the passing of Hugh McCoy during the weekend of 6/7 April.
Mr McCoy was first elected a Member of the Baltic Exchange on 16 September 1971. In the early 1980s he represented Cleaves & Company Ltd, moving to represent H Clarkson & Co Ltd between 1983 and 1998. In 1998 he was elected for The Hadley Shipping Co Ltd until becoming a Retired Member in 2015.
Speaking on Hugh McCoy’s passing and the impact he had on the industry, Clarksons said in a statement:
“Highly regarded within the industry Hugh will be greatly missed and will always be remembered for his leadership, knowledge and unquestionable passion for the business.”
Mr McCoy served on the Baltic Board of Directors between 1992 and 2000 and as Chairman of the Baltic Exchange between 1998 and 2000.
The funeral will take place on Thursday 25 April 2019 at 12:30 at Bentley Crematorium, Ongar Road, Brentwood CM15 9RZ and the service will be followed by refreshments at Marygreen Manor Hotel, London Road, Brentwood CM14 4NR.
For more information, Members and friends are invited to direct any enquiries to Jackie Harrison.
- Member update: 10 April
The following company has applied for Corporate Membership:
Company Individual Archangel Pacific Ltd
Mr P I Courousopoulos Triomphe Shipping Pte Ltd
Mr B Cohen Mr C G Thompson
The following individuals have applied for membership of an existing member company:
Company Individual Affinity (Shipping) LLP Mr J Palairet Charles R Weber Company Inc
Mr M Moisio
Devbulk Trading Limited
Capt C Buyukkoroglu Lloyd’s Market Association Mr N Roberts Swissmarine Services S.A.
Mr I Moore
The following individuals have applied for Retired Membership:
Mr B G Few Brown
Mr C J Hunt
Any comments should be passed to Karen Karanicholas by 17 April 2019.
- Space for rent at the Baltic Exchange
The Baltic Exchange wishes to inform members that room RLG10A (546 sq ft) on the lower ground floor of the Baltic Exchange is now available for rent.
For more details, please contact Mark Read. Pictures of the space can be found below:
- Geopolitical tensions and technological innovations
The commodities industry faces a difficult year ahead with an ever-changing political landscape, a US–China trade war and the introduction of innovative technology: this will present new challenges, but also opportunities, for traders.
US–China trade war
Despite a temporary ceasefire between the US and China, the reality is that many of the trade tariffs remain in place. Most notably, the US-imposed tariffs target steel and aluminium imported from China, and the China-imposed tariffs target US agricultural and consumer products.
The US/China trade deficit hit a 10-year high in December 2018, when the import/export deficit increased to $491bn. Given the unpredictability of the Trump administration, it is not clear what this will mean for the commodities industry in the short, medium or long-term.
Soyabean markets have been hit hard by Chinese tariffs, pricing the US out of the market, along with many of its other bulk crops. Soyabeans were the US top agricultural export to China in 2017, worth about $12.7bn. With an oversupply in the US due to the trade war, prices are likely to fall, and the US Department of Agriculture expects world soyabean stores to grow 9% on the year to 106.72m tonnes in autumn 2019. Traders are looking to fill the supply hole left by the US, with the likely winner being Brazil.
The remainder of 2019 will be interesting for the commodities industry as a whole
US oil exports are also in the midst of a drought. Before the tariffs, China accounted for 20% of all US oil exports; this is now almost down to 0%. Russia has benefitted the most from China’s ever-growing demand for crude oil.
Amongst the unrest and uncertainty, China and the US will each be looking for suppliers in different markets and traders will need to be agile and responsive in order to capitalise within this volatile market.
Development of technology
The development of technology, such as the use of blockchain, is leading to a more secure and integrated supply chain, revolutionising the way products are tracked and approved, leading to a faster, cheaper and more secure way of settling transactions in all commodities, whether soft or hard.
The technology behind blockchain has the ability to cover many aspects of the supply chain, from financing to execution and logistics. The hope of moving away from the exchange of contracts and letters of credit by fax may soon become a reality.
The traditional model whereby traders financed farmers, bought their crops, stored them and sold them is ceasing to exist. Farmers have become much more sophisticated in a technology-advanced world. Farmers have access to market data, yield and weather reports, and as technology develops, farmers will gain greater control.
Traditional commodity traders will be looking at forming closer ties with suppliers and investing in new technology, creating a more integrated and consolidated supply chain.
Mergers and acquisitions
Prices across the crops sector remain relatively low, as a result of record output of coffee beans from Brazil driving down prices; increased foreign competition from the likes of Argentina, Brazil and Russia; and ever-thinning margins. Soft commodity traders are likely to be forced to consolidate as they look to acquire market share amid an ever-consolidated customer base.
The metals industry saw a record year in 2018 for mergers and acquisitions, with a total deal value of $53.4bn, compared to $28.1bn in 2017. Deal value in Q4 2018 declined by 70% versus Q3 2018 to $5bn, though announced deals in 2019 suggest that this may be a temporary slowdown.
The remainder of 2019 will be interesting for the commodities industry as a whole as it looks to tackle a heated geopolitical climate, ongoing demand for rare metals and increased price competition in the agricultural sector. Consolidation may be the best way to tackle such issues for the bigger players but, as always, there will be opportunities for the more nimble.
Simon Vere Nicoll is Partner at Clyde & Co, a global law firm focusing on trade and commodities, energy, insurance, infrastructure and transport. Contact him on +44 (0) 20 7876 5000 or by emailing email@example.com.
- Fehr Cup: 26 June
This year’s Fehr Cup will be held on Wednesday 26 June at Surbiton Rackets and Fitness Club.
Tennis, Pimms, summer lunch with strawberries and cream, this fantastic networking opportunity for tennis players of all levels is a must in the shipping social calendar. Taking place on the grass courts of Surbiton and including lunch and tea in the clubhouse. The tournament is split into two parts, after an initial stage, more social players can enjoy an afternoon of relaxed open competition in the American Tournament, while the pros peel off to dual for the ‘Fehr Cup’ prize.
Any firm represented on the Baltic Exchange is eligible to enter one or more pairs. However, both players must be from the same member company, but the people do not have to be Baltic members themselves. Any player may be substituted but still needs to work for the same company.
Both male and female players are welcome, and the pairs can be in any combination. The matches will be the best of three sets in the main draw with a tie break at six-all in each set.
The games will be on grass (weather permitting) with play commencing at 10am sharp. The Club asks that players do not wear trainers or running shoes in order to protect the grass for the season.
The entry fee is £75 per pair, payable in advance. This fee includes the courts, coffee, lunch and afternoon tea for all players, as well as prizes for the placed teams in both tournaments. Catering for non-players is priced at £15 per head, but this also needs to be booked in advance.
The Tournament will be refereed by Perry Perera, with the American format arranged by Costas Mamarides, who will umpire the main final.
The points gained in this Tournament will go towards the David Bradley Cup. Pictures from last year’s event can be found here.
Useful information for those taking part
Address: Berrylands, Surbiton KT5 8JT tel 020 8399 1594
If you are coming by car, the parking is only on the Club side of the road in Berrylands or on the adjacent roads.
If you are coming by train, Surbiton Station has a faster, more frequent, service from Waterloo and is slightly nearer than Berrylands. It is a five-minute taxi ride or a 10-minute walk.
Further contact details
Tel: 07563 790273 or 020 8399 0398
Tel: 020 8391 0351
- BESA: Warwick Cup
This year’s Baltic Exchange Sailing Association (BESA) Warwick Cup will take place on the 18-19 May at Seaview, Isle of Wight.
There are no stipulations on who may helm each boat and after every race there will be a chance to rotate crews. So teams/squads can be as large as you like, giving everyone a chance to have a go on the water. There will also be opportunities for those not racing to witness the action close up and take photos from one of the Yacht Club’s fast tenders or just to go for a spin.
The tentative schedule is as follows:
- Friday PM: Arrive Seaview
- Saturday: Racing Seaview Mermaids http://www.seaviewmermaids.co.uk
- Saturday Evening: Three course dinner at the Sea View Yacht Club with late bar/tombola/prize giving
- Sunday AM: Racing Seaview Mermaids before lunch/prize-giving. Should be away by 1400 ish
This event counts towards the David Bradley Memorial Trophy
Entrance forms can be found here, these forms and fees, which includes the three course dinner, as well as Baltic Exchange membership must be submitted by 28 April 2019. Full rules can be viewed here.
For any further information, contact on the details below.
Eggar Forrester Shipbrokers – CW Kellock & Co Ltd
Fifth Floor, 2 London Wall Buildings, London Wall, London, EC2M 5PP