Roads to Recovery: Comparing and Contrasting the Outlook for … · 2018-03-21 · Roads to...
Transcript of Roads to Recovery: Comparing and Contrasting the Outlook for … · 2018-03-21 · Roads to...
Roads to Recovery: Comparing and Contrasting the Outlook for Distressed Sectors
Niklas Carlén – Maritime Strategies International (MSI) 18th Annual Marine Money Greek Ship Finance Forum – 11th October 2016
Introduction
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Peak to Trough Comparision:Peak 2006-08 Levels Vs Q2 2016
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-100%
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T/C Rate 5-Yr Old Price
Demand
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Iron Ore:Chinese Imports Growing Despite Stagnant Steel
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Chinese Steel Production Chinese Iron Ore Imports
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MnTRest of World IndiaS Africa BrazilAustralia
Forecast
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MnT Steel Production Yoy% ChForecast
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Coal:Indian Outlook Shrouded in Uncertainty
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Chinese and Indian Coal Imports Coal Seaborne Trade
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MnT China IndiaForecast
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MnT Coking Coal Steam CoalForecast
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Other Bulks:Short-Term Plateau, Medium-Term Growth
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Grains+Soya Seaborne Trade Minor Bulks Seaborne Trade
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MnT Soyabean+Meal GrainsForecast
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YoY % Ch
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TEU Trade and TEU Miles
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Asia-Europe isn’t dominant in volume terms, but is in terms of capacity required
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Mn TEU of trade
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Shipping capacity required (RH Axis)
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Container Demand:2016 Volume Weakness
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North-South trades have been the worst affected, but trade disappointing across the board
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Oth
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2016 growth
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Trade Growth is Key to Cascading
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• The cascade has currently broken down – four reasons:
➢ Low fuel price ➢ Slow trade growth ➢ Service fragmentation ➢ Alliance reshuffle !
• In our view, trade growth is the most important of these; lines upsized in anticipation of trade growth, when that disappointed then swift ly downsized. !
• Huge supply of spot ships puts lines under no pressure to secure tonnage – can keep flexibility (2-12 month fixtures).
Non-Mainlane East/West Trade
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Headhaul E/W Trade YoY % Ch
Vessel Deployment, k TEU
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0.1-2.9k TEU 2.9-5.2k TEU5.2-7.6k TEU 7.6-12k TEU12k TEU+ Demand (RH Axis)
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Container Cascade
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Evolution of Asia-Europe Deployment Intra-Asian Deployment
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Mn TEU
12k + TEU 7.6-12k TEU 5.2-7.6k TEU3.9-5.2k TEU 2.9-3.9k TEU 1.3-2.9k TEU
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Mn TEU7.6-12k TEU 5.2-7.6k TEU 3.9-5.2k TEU2.9-3.9k TEU 1.3-2.9k TEU 0.1-1.3k TEU
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Seaborne Growth Prospects Compared:Dry Bulk Vs Container Trade
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0%
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YoY % Ch Container Dry Bulk
Average Annual Trade Growth Over 5-Year Periods (CAGR)
Supply
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Current Orderbook:Sectors Over-Exposed
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Required Ships* Vs Orderbook YTD Capacity Adjustment
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Bulker Container
Ships RequiredShips on order
*Required ships to meet incremental demand, irrespective of current over-capacity
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Contracting Scrapping
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Old Tonnage versus Orderbook
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Bulk Carriers Containerships
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Mn TEU
Over 15 Years Orderbook
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Mn Dwt
Over 15 Years Orderbook
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Help from Unusual Places?
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Imminent Significant (3rd+) Special Surveys
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Bulk Carriers Containerships
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Mn TEU6th+5th4th3rd% of current fleet (RH Axis)
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YoY % Ch Container Dry Bulk
Fleet Growth Compared:Dry Bulk Vs Container Trade
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Average Annual Fleet Growth Over 5-Year Periods (CAGR)
Roads to Recovery
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Roads to Recovery:Weighted Average Timecharter Indices Compared
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T/C Index (2015=100)
Bulker Container
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MSI - FMV
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• MSI Forecast Marine eValuator (FMV) is the first web-based tool to provide forecast and historical price data covering virtually all of the deepsea shipping fleet. !
• Data includes forecasts of newbuilding, second-hand prices, 1 year timecharter rates and operating costs for specific vessels. !
• MSI FMV draws on MSI’s proven, proprietary models and a consistent cross-sectional view across all principal shipping sectors. It puts asset values in the context of the near term market to enable reliable benchmarking with outputs based on annual averages. !
• Coverage: !Crude Oil Tanker
Product Oil Tanker
Dry Bulk Carrier
Chemical Tanker
LPG Carrier
LNG Carrier
Multi Purpose
Containership
PCC/PCTC
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FMV Output
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Quarterly Fair Market Value & 1 Year Time Charter Rate (1Q history, current Q, 2Q forecastAnnual average: • Newbuilding contract
price • Fair Market Value • 1 Year Time Charter Rate • Operating Cost 5 years history and 15 years forecast
Price Development Chart detailing forecast price development in relation to historical metrics
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Asset Play PrognosisBuy 5 year old today – sell in 5 years time
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While this document has been prepared, and is presented, in good faith, Maritime Strategies International assumes no responsibility for errors of fact, opinion or market changes, and cannot be held responsible for any losses incurred or action arising as a result of information contained in this document. !The copyright and other intellectual property rights in data, information or advice contained in this document are and will at all times remain the property of Maritime Strategies International.
Disclaimer
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For over 30 years, MSI has developed integrated relationships with a diverse client base of financial institutions, ship owners, shipyards, brokers, investors, insurers and equipment and service providers. !MSI’s expertise covers a broad range of shipping sectors, providing clients with a combination of sector reports, forecasting models, vessel valuations and bespoke consultancy services. !MSI is staffed by economists and scientists offering a structured quantitative perspective to shipping analysis combined with a wide range of industry experience. !MSI balances analytical power with service flexibility, offering a comprehensive support structure and a sound foundation on which to build investment strategies and monitor/assess exposure to market risks.
MSI Background
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London SE1 1YW United Kingdom
!Tel: +44 (0)207 940 0070 Fax: +44 (0)207 940 0071
!Email: [email protected]
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