- YBA Night London
The Young Baltic Association (YBA) invite you to a night of drinks, 10 pin bowling and sliders at All Star Lanes, Brick Lane on 27 June.
Kicking off at 6pm, the event is free to attend to all member companies. Teams of five will be set on the night, with prizes for the top two companies. Spaces are limited to 120 so register early to book your place.
To register, click here.
- Member update: 26 June
The following individuals have applied for membership of an existing member company:
Company Individual BACA – The Baltic Air Charter Association
Mr C de Burgh Mr K Ducksbury Mr R Ziskind Oil Price Information Service – Asia Pte Ltd Mr R Sheridan Rio Tinto Shipping (Asia) Pte Ltd Ms E Tang Seasure Shipbroking Ltd
Mr M Freeman Mrs G Gavin
The following individual has applied for Retired Membership:
Mr D J Greenin
Mr C N Symeonides
Any comments should be passed to Karen Karanicholas by 3 July 2019.
- Funeral details for former Baltic Member, Andrew Hill
Members will learn with deep regret of the death of Andrew Hill who passed away on 12 June 2019.
Mr Hill was first elected a Member of the Baltic Exchange in 1972 and throughout his membership he represented Howe Robinson.
His funeral will be held at Woodvale Crematorium, Lewes Road, Brighton BN2 3QB on Friday 5 July 2019 at 1500 and afterwards, refreshments will be at Oakwood Farm, North Common Road, North Chailey BN8 4ED.
If any member is planning to attend the funeral the family would be grateful if you could contact Judy Webb at Howe Robinson (email@example.com) so that she can advise the family of approximate numbers likely to attend from the shipping community.
No flowers but gifting a donation to either the Bluebell Railway or the RNLI would be most welcome. To donate, please go to Justgiving.com/crowdfunding/AndrewCRHill
For those wishing to write to Susan Hill, the address is Oakwood Farm, North Common Road, North Chailey, East Sussex BN8 4ED
- YBA Night Singapore
The Young Baltic Association (YBA) Singapore will be holding an event on 27 June at The Exchange Bar @ Asia Square.
YBA nights are open to all Baltic Exchange members and employees of Baltic Exchange member companies who are under 35 years. No RSVP required.
All members are entitled to two drink coupons at the reception. For other guests, a SGD 20 per guest will be charged at the reception.
Attendees are invited to join us from 6.30pm.
Address: 8 Marina View, 01-05, Asia Square Central, Singapore 018960
- Differences of opinion on container outlook
In an economy mired by trade wars, rising global unrest and increasingly complex geopolitics, views are – unsurprisingly – mixed about the future fortunes for container shipping.
At Multimodal 2019, a freight transport, logistics and supply chain management event held in Birmingham in the UK last week, one of the world’s biggest box shipping firms, Ocean Network Express (ONE), took the optimist position about sector growth.
“The container shipping industry has been for, actually, the last five decades — except for one year — a growth industry, so [it] is very likely to continue to grow,” Stanley Smulders, ONE’s marketing and commercial director for the Europe and Africa region, explained. “How much that will be, … that depends, of course, on very many political developments, economical developments, but in principle, we would expect that the industry as such will continue to grow.”
Yet, Andy Foulds, sales director for the UK at container transport firm Samskip, said that because of the uncertainty surrounding the UK’s departure from the EU (Brexit), much of his company’s outlook currently “has a question mark against it”.
“Generally speaking, we’re still waiting for the normal patterns of trade to settle down. … We’re seeing quite a lot of volatility, which makes it quite difficult,” he noted. Commenting specifically on Brexit, he said: “People are looking at how they can risk mitigate, how they can perhaps re-engineer their supply chains, and some customers, for the first time, are now starting to look at containers rather than just simply defaulting to trailers. So, while it’s a challenging time with the volatility, it’s also a very interesting time, with new opportunities coming up.”
According to Mr Fould “the major impact” for Samskip is the current volatility in the industry connected to this Brexit uncertainty. When there’s volatility, the impact for fixed assets — ships that sail daily or rail that moves daily — is that one day they’re full and the next day they aren’t, he said, and that leads to greater prices for the consumer as they’re now having to pay when ships are both empty and full. Therefore, net, the prices per load are increasing. However, Mr Fould also explained that customers are now having to question their supply chain related to the threat of Brexit and whether the Strait of Dover, the most narrow part of the English Channel, will see delays. For container operators, the opportunity here centres on new customers exploring different routings for the first time.
Points of contention
Despite his expectation for box shipping sector growth, Mr Smulders did note that there are a number of challenges at play. Discussing the International Maritime Organization’s incoming 0.5% limit on sulphur in fuel oil used on vessels operating outside designated emission control areas, he said that the move to low-sulphur fuel “is probably a major challenge for the whole industry and for its customers” due to the high costs. Two big challenges come with the switch to cleaner fuels: they are “not so much” available at the moment and they will be much pricier.
“People who ship containers need to be prepared that the price will go up to recover those costs,” he warned.
“This is an industry where the financial probability and financial situation of shipping lines are not always that easy, and it has a lot to do with the supply and demand situation,” Mr Smulders added. “We normally have too much ship capacity compared to demand. That is an ongoing challenge because when ships are being ordered, you never know how the industry will exactly develop other than, we hope, that it continues to grow.”
Mr Smulders additionally noted that with vessels increasing in size, ports are facing mounting challenges. Few ports exist that can handle large ships, and increasing vessel size affects land transportation — whether it be rail, truck or barge — because greater volumes means more capacity is needed to move the containers inland.
However, Mr Smulder said that where there are challenges for the container shipping industry, there are also opportunities. If fuel is much more expensive, fuel consumption becomes increasingly important, he explained, and firms with the most modern fleets have advantages. Additionally customers could well make a pronounced shift from non-containerised to containerised transport to take advantage of savings, while digitisation of processes and interaction with clients brings further opportunities, he added.
In analysis of the box shipping market published in June, Peter Sand, BIMCO’s chief shipping analyst, said that as the body predicts weak demand-increase for the quarters ahead, the sector will revert back to negative margins.
According to a webinar, Mr Sand said that world trade is stalling, industrial production is in sharp decline and new orders are decreasing too. Furthermore, economic growth is forecast to remain flat for emerging economies and decline for advanced ones. The challenge for the shipping industry, the webinar claimed, is to adapt to much weaker demand growth at the same time as handling agenda-topping regulatory issues. For container shipping, the webinar said, numerous pitfalls over the coming months will determine the destiny of 2019.
The Baltic Exchange publishes a weekly set of container spot rates in collaboration with the digital container freight platform Freightos and promotes the Ningbo Shipping Exchange’s Ningbo Containerised Freight Index. The Freightos Baltic Indices reflect weekly spot rates for 40-foot containers based on 12 to 18 million price points collected every week on 12 main shipping trade lanes. The data includes a headline index — the FBX Global Container Index (FBX) — a weighted average of the 12 underlying route indexes. This data is published every Sunday. The Ningbo Containerised Freight Index is a weekly composite index covering 20ft, 40ft and Hi Cube box rates and is published every Friday. More information can be found here.
- Baltic Exchange Freight Market Risk Forum, Hamburg
The Baltic Exchange will be running a Freight Market Risk Forum in Hamburg on 17 October.
More information to follow.
- Baltic Exchange & Tradewinds Shipbroking Forum
As part of London International Shipping Week 2019, the Baltic Exchange and Tradewinds will be collaborating to present an International Shipbroking Forum.
The forum, relevant to shipbrokers, shipowners, charterers and freight traders, will take place on 11 September and is by invitation only.
More details to follow.