Difficult days, months and possible years ahead for the BDI…

Markets, Military, News, Piracy and Terrorism, Sales and Purchases, Ship Finance, Shipping Indices, Statistics, Stock Markets — By on March 30, 2016 at 3:43 PM
John Faraclas

John Faraclas

With five points plus since yesterday the BDI at 414 freezes everything for until 2020! This is a very extreme, but orthologistic projection, given the current state of global affairs, be it financial chaos and uncertainty to all levels in shipping, or wars which  coupled with uncertain geopolitics and economic/tax companies structures, advises caution; John Faraclas reports:

Despite the fact that all Baltic Dry Indices were on the plus today, the gloom is here to stay. Thoughtful owners prefer conservatism and fix their tonnage for period at levels to survive the storm. Others are losing day by day the grip and some flamboyant ones try to save their skin. Regulatory bodies though as we understand are there to protect investors’ interest, irrespective if these companies are listed or not.

The BDI’s plus five points sounds great with today’s realities (up five). The BCI 2014 just managed a plus three, now standing at 210 points – the Capers will create more havoc. The Panamaxes, our preferred size were on the right track with 13 plus points since yesterday, now standing at 484! The Supras clinched just one – now at 475 and the Handies followed suit at 271 points (plus one). So far away, as the song says, from the end of December 2013 “low” (?) market of 2, 274 points.

Once again the Wets with mixed feelings. The last published BDTI and BCTI stood at 818 and 496, that is a plus nine and a minus one points respectively.

The price of WTI as you read these lines tries hard to remain above the US$ 38 mark…

On the Geopolitical front, countries harmed from the Terrorists, ISIS in particular, cannot proceed with reforms, much needed to protect their citizens; what’s up Mr. Hollande?  Many are trying to convince the European Union leaders that enough is enough with the Terrorists and zero tolerance is the name of the game! Terrorism and Migrants mingle together as the best cocktail landing/branding or better say measuring  the late Molotov’s special instrument , that is to say the Molotov Coctail, null and void!

Many countries’ fate from Gibraltar to North Korea and from Sweden down to the Horn of Africa, is at stake; the epicentre obviously is the Middle East and its immediate periphery!

The Economy and the excesses of the plastic money scam will shake the world to its foundations. Some years ago on another medium I have expressed the importance of who is to hold and use the plastic card, and indeed I was politically and socially biased – but I have won the argument. Only the ethical affluent should obtain them! See what he social capitalism did to bring in these new products and service so as society, the world at large to postpone the major social upturn from the low middle class to the poor. What a shame to give in… “Buy now”, “pay later”, “zero interest until…” and all that jazz of buzz words and phrases which continue to wreck the economy, the banks, the wealth of people, and of course, not that of the nations, of course not! Expect a total mess on this issue with the Chinese social capitalism…in full swing!

The Panama Canal will also create another modus in the logistics chain and hopefully Panama, as many expect, can become the world’s shipping, economic and tourist hub at least on par with Singapore – some being more optimistic, say:” …even surpassing same…”

Protectionism movements too such as BREXIT, GREXIT and others will create economic, social, political and military spill overs. Wonder how the public considers Russia, new Russia following the collapse of the Soviet Union? The Reds are dead, but Russians are Russians and will always be Russians; so what’s the excuse the “West” can unleash now?

We need another Yalta, there were wrong acts there and unfinished business and the religious factor made it even worse. Add the fact that if you betray your allies, at the end of the day you will end far worse than them.

Being pragmatic and optimistic, and despite all the above, if you have the appropriate means in place, this is the bets market for shipping, a buyers’ market after all; about time. We need though some scandals to be aired, as good owners suffered due to the new kids in the block syndrome…

Have a nice evening!

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