- LAST CHANCE: Baltic Risk Forum At Posidonia
The final bookings are being taken for the Baltic Exchange’s Risk Forum at Posidonia. To register, click here.
Focusing on the issue of risk in the freight and shipping markets, the challenges and opportunities that these can present and what is available to help members manage their exposure, the programme will include:
- An A, B, C (and D & E) of how the Baltic helps members manage risk – Mark Jackson, CEO, Baltic Exchange
- A Perfect Match? Physical Indexation and the FFA Market – Duncan Dunn, Director, SSY Futures
- BDRY ETF: Democratizing Investing in Shipping – John Kartsonas, Managing Partner, Breakwave Advisors
- What are the Commercial Implications of the 2020 Sulphur Cap? – Mark Jackson, CEO,
Baltic Exchange, *new speaker confirmed* Theofanis Anastasiadis Projects Manager Starbulk, Brian Nixon, Managing Director, Lavinia Bulk Ltd. and Angelica Kemene, Head of Market Analysis & Intelligence, Optima Shipbrokers
The event takes place at the Yacht Club of Greece, 4 June (Forum 1100-1400, followed by lunch).
- YBA London drinks
The Young Baltic Association (YBA), London, will be holding a drinks reception at Flight Club on 31 May.
‘Bringing something completely different to the London bar scene, Flight Club is one of London’s most talked about fun-time bars. Re-imagining everything you think you know about darts!
Gone are the days of dodgy maths and writing on chalkboards, Social Darts uses real-time scoring created by an actual rocket scientist to change Britain’s favourite pastime forever. Combined with some awesome animated scoring and a slick touch screen interface. The result? A super fun and fast social experience‘.
Food and drink are free, with limited spaces still available for full teams of 6.
YBA events welcome all Baltic members under the age of 35.
For more details, click here.
- Bunkering down
The much-anticipated new version of BIMCO’s standard contract Bunker Terms 2018 was formally adopted early in May in New York. The BIMCO committee which drafted the Bunker Terms 2018, consisted of representatives from across the bunker industry including three major bunker suppliers/traders, shipowners Norden and J Lauritzen, the North of England P&I Club, the International Bunker Industry Association, and James Kennedy of Clyde & Co.
Background and purpose
Following the OW bankruptcy and the UK Supreme Court decision of “Res Cogitans”, there were calls from across the industry for a contractual solution to protect against the consequences that flowed from the OW bankruptcy, e.g. double payment by buyers.
Additionally, in a volatile market with no widely and commercially acceptable existing standard contract terms, there was a plethora of contractual terms being used across the industry causing contractual uncertainty, extended contractual negotiations and the potential for disputes for both buyers and sellers.
The first purpose of the Bunker Terms 2018 was to contain an OW Bunker type protective clause. The second purpose of the Bunker Terms 2018 was to be a more balanced set of terms which were commercially acceptable to both buyers and sellers, which would then boost harmonisation of trading terms across the industry to bring clarity and certainty to bunker sale and purchase transactions, and reduce the potential for disagreement.
There are … several changes to the terms including delivery, payment, and claims management clauses
After wide consultation and a thorough examination of possible solutions, it was concluded that there is no legally and commercially workable OW Bunker type protective clause that would be widely accepted by the industry. Instead, the Bunker Terms 2018 will be accompanied by advice and guidance to better protect parties against double payment, by helping the industry to focus on better risk management, understanding of contractual terms, and know-your-counterparty due diligence before entering into a contract.
In relation to the second purpose, to strike a fair balance between the interests of buyers and sellers, a substantial amount of work and industry consultation went into redrafting and redesigning the previous terms to make them more commercially acceptable. There are, therefore, several changes to the terms including delivery, payment, and claims management clauses.
The most important changes however are a new liability cap and the use of a “Confirmation Note” and an “Election Sheet”. The lack of a liability cap was seen as a stumbling block for the previous BIMCO terms gaining a stronger foothold in the market. The inclusion of the Confirmation Note was to reflect industry practice in the purchase and supply of bunkers. Similar to the Gencon or NYPE charterparty forms, the Election Sheet was viewed as a way of allowing parties to negotiate the terms more easily. The Bunker Terms 2018, therefore, don’t have to be a “take it or leave it” style document and instead can be used as a template with parties free to adapt it to cater for particular commercial and legal factors.
The Bunker Terms 2018 should go a long way toward providing certainty, simplifying negotiations, expediting transactions and reducing the potential for disputes between the parties. Although it may take a little while for parties to become acquainted with the new terms, given the wide consultation across the supply chain during the drafting process (including strong representation from physical suppliers and traders), it is expected that the whole industry will respond positively to the introduction of the new standard contract. In the meantime, until there is wider uptake on the Bunker Terms 2018, scope for discrepancies in the contractual supply chain is likely to remain.
Presentations and seminars will be provided by BIMCO to help the industry better understand the new terms.
James Kennedy is a Senior Associate at Clyde & Co and is based in the global law firm’s London office. Contact him at email@example.com or by calling +44 20 7876 4731.
- Baltic and ICS Lunchtime Lectures return to Shanghai, Singapore, Athens and London
The Baltic Exchange and Institute of Chartered Shipbrokers (ICS) lunchtime lectures returned today (30 May) with events in Shanghai, Singapore, Athens and London.
Money Walks / Money Talks – A masterclass in the hedging and financial instruments used by shipping principals was the theme in Singapore, Athens and London with guest speakers below:
Singapore: Raghu Raghunath, Former Head of Noble Chartering
London: John Banaskiewicz, MD, Freight Investor Services
Athens: Katerina Stathopoulou, Executive Director, Investments & Finance
In Shanghai, the focus was Shipping Supply-Demand Dynamics. Guest speaker, Tan Say Liang, General Manager, Shanghai, SGX, examined the economic factors that have caused the major changes in shipping rates over the past 12 months and look into what is anticipated to cause the most impact on freight markets throughout the remainder of 2018.
Baltic ICS lunchtime lectures are free to Baltic and Institute Members.
- Baltic Exchange Training Courses – June 2018
The Baltic Exchange is now taking bookings for its training courses in London and Singapore during June.
The courses offer high-level training to shipping, financial and commodity professionals. Courses taking place in June include:
Freight Derivatives & Shipping Risk Management (25-26 June, Singapore)
Delivered over two days by experts in the areas of shipping and commodity risk management, the Shipping Risk Management course aims to raise market awareness of risks involved in shipping businesses and how various physical and derivatives instruments can be used to control such risks efficiently and effectively. Participants will learn how to analyse and measure the impact of financial risks involved in shipping investment and operations, and how to select and execute effective strategies to minimise or eliminate such risks, stabilise their cash flow and maximise the return on investment more efficiently.
Advanced Freight Modelling and Training (27-28 June, Singapore)
This advanced two day module focuses on modelling freight rate dynamics and pricing options on freight. It discusses issues which are relevant to shipping market practitioners such as constructing forward curves on freight, modelling freight rate volatility as well as hedging and trading strategies using freight options. The course aims to provide delegates with both a theoretical foundation as well as practical hands-on experience.
Shipping Economics & Investment (18-19 June, London)
The course aims to provide delegates with both a theoretical foundation as well as practical hands-on experience on modern shipping economics and investment. It provides delegates with the essential knowledge of shipping economics, operations and investment management. The programme covers the microeconomic structure of the shipping markets including freight, second-hand, newbuilding and scrap markets and presents how these shipping markets interact.
For more information or to book onto one of these courses, click here.
- Fehr Tennis Cup
On 27 June the Baltic Exchange will be holding the annual Fehr Cup at Surbiton Racket & 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 which gives, more social players an afternoon of relaxed open competition in the American Tournament, while the pros peel off to dual for the big ‘Fehr Cup’ prize.
Entry, including lunch and refreshments, is £70 per pair.
For more details, please email:
Catharine Bacon – firstname.lastname@example.org
Perry Perera – email@example.com
- Member update
The following individuals have applied for Membership of an existing member company:
Company Individual Heidmar Inc Mr J Christakopoulos A.M. Nomikos & Son (UK) Ltd Miss K Raniou Miss A Kyriazidou Invivo Trading Mr J Scotte Mr T Bigoin Mr S Miri` Pacific Basin Shipping (UK) Ltd Mr P M Amat Dampskibsselskabet Norden A/S Mr V Estevez-Castrillo Miss S Schoenherr Cargill International SA Ms B Dolciani Hopp Worldwide Private Limited Mr P Gulati
The following company has applied for Corporate Membership:
Company Individual Bromar Shipping Limited Mr J Yin Mr P Zhou Mr B Wang
The following individuals have applied for Retired Membership:
Mr D J Aikman Mr D B Caney
Any comments should be passed to Karen Karanicholas by 6 June 2018.