Dry bulk ship operator Golden Ocean finished the first months of the year with a bottom line deficit that is USD 31 million worse than last year. This trend could continue in the second quarter, expects the company.
Two former co-owners and an employee of TKB Shipping have founded dry bulk operator Union Bulk. "We all think it would be exciting to build something up from the ground," one founder tells ShippingWatch.
Dry bulk ship operator Goodbulk defied weak conditions in the first quarter, which became the company's eighth consecutive profitable quarter. But the result was a setback compared to last year, and even though the company is currently noting market improvements, there is still significant uncertainty.
Norden Chief Executive Jan Rindbo says that the downturn in dry bulk has served as a litmus test for the company's new strategy to lease rather than own ships. In the past, a similar slump would have eradicated the bottom line, he tells ShippingWatch.
A Brazilian court has invalidated Vale's permit to reopen the company's second-largest mine after the accident in January. The decision has already impacted spot rates in the capesize segment and could, according to analysts, turn recent positive momentum around.
Clipper Bulk has long been struggling financially. But the sudden downturn on the dry bulk market in the first quarter of 2019 demanded instant action, tells CEO Peter Norborg in an interview with ShippingWatch following mass layoff.
A surge in scrapping activity is not enough to compensate for the wave of new capesize ships that is finding its way to the already-strained market for the large dry bulk vessels, warns shipping association Bimco.
The first quarter of 2019 ended with another deficit for dry bulk company Scorpio Bulkers, although the deficit was slightly smaller than the deficit from the first three months of 2018, shows the company's interim report.
Although 2019 got off to a rocky start, in part due to January's dam catastrophe in Brazil, several prominent dry bulk shipping companies maintain their belief that the market will improve in the second half of 2019 and in 2020.
Despite a recent recovery for capesize, investment bank Cleaves Securities cuts its growth forecast in half for the Baltic Dry index in the coming months. For the biggest ships the investment bank now projects negative demand growth this year.
While many observers believe that the bottom has been reached for the strained capesize segment, Clarksons Platou warns that rates do not have to go much further down before shipowners will have to let their ships idle.
Fearnley Securities sees signs of the strained capesize segment having hit rock bottom, with rates now being lower than in smaller segments. "March should result in an imminent market upturn for the biggest ships," the shipbroker writes.
After a miserable start to 2019 for dry bulk, Hong Kong-based shipping company Pacific Basin now notes that the seasonal improvement in the sector is underway. But weaker economic growth and looming trade war will lead to more volatility, expects the company.
While there are a fair number of pessimists when it comes to dry bulk rates, there are also those who are confident in an impending boom. For instance, Cleaves Securities' chief analyst projects a significant upturn in the second quarter following an "abysmal" start to the year.
Golden Ocean booked a profit in the fourth quarter but is currently navigating in an uncertain dry bulk market, in which the Vale accident has made an impact. Sentiment is negative, says CEO Birgitte Vartdal.
One of the world's largest commodity traders, Cargill, which operates more than 500 ships, has changed its view of 2019 radically within just a few months. Dry bulk demand could go negative this year for the first time in many years.