More From Katie Dale
Scorpio Tankers’ shares in Dorian to be registered for resale
Dorian will be registering for resale, under the Securities Act of 1933 as amended, all the Dorian shares that Scorpio Tankers (STNG) owns. Scorpio Tankers currently owns approximately 9.4 million shares, or 16.3%, of Dorian.
Must-know: Why products supplied are increasing
For the week ending October 3, 2014, total products supplied were 19 million barrels per day (or bpd)—compared to 18.6 million bpd in the first week of September.
Navios Maritime Acquisition fleet enjoys profitable charter rates
A strong increase in tanker rates is allowing Navios Maritime Acquisition to secure attractive contract periods for its fleet of charters.
Scorpio Tankers adopts a shift in charter mix
For the third quarter of 2014, the charter hire expense increased $1.1 million to $32.9 million, from $31.9 million in the year ago quarter.
Why China’s iron ore port inventory is marginally higher
China buys around two-thirds of the world’s iron ore—iron ore supply in China outpaced demand by 52 million tons in the first half of 2014, according to the China Iron and Steel Association (or CISA).
Why Diana kept buying after its fleet capacity grew 23.75% in 2013
The year 2013 was characterized by significant expansion of Diana Shipping Inc.’s (DSX) fleet, as the dry bulk shipping industry turned a corner.
Despite dividends, Navios is still unattractive to many investors
Dividend yield for Navios Maritime Partners currently stands at 15.8% with the company recently paying a dividend of $0.4425 per common unit.
Why 5- and 10-year Very Large Crude Carrier prices are consistent
Five-year-old VLCC prices remained consistent, at $75 million, with the previous month’s levels. Year-over-year prices increased by 36%. Ten-year-old VLCC prices stood unchanged at $48 million and increased by 41.2% year-over-year.
Why can Navios Partners give out higher distributions?
While Navios Maritime Partners (NMM) is less sensitive to shipping cycles because of its longer-term contracts and staged expirations, it’s still subject to market rates when contracts roll over.
Why China’s iron ore and coal imports declined
China imports almost 60% of the world’s seaborne iron ore while its coal trade accounts for almost a quarter of the global trade.
Dry bulk shipping industry players and performance
China accounts for a major share of dry bulk commodities’ imports and exports. In the past three months, the Guggenheim Shipping ETF (SEA) dropped 6.1%.
Why a high cash breakeven cost is risky for Frontline
The cash breakeven costs are the daily rates of Frontline’s (or FRO) vessels. They have to earn the rates to cover budgeted operating costs and dry dock, estimated interest expense, payable at hire, and corporate overhead costs.
Why the Baltic Dry Index is decreasing
The Baltic Dry Index measures the cost of major raw materials. The raw materials are transported by sea in the global economy. It indicates a strict demand supply price situation.
China’s thermal power output recorded a downfall
China’s power consumption in August was 502.5 billion kilowatt hours (or kWh). This was a decline of 1.5% from the levels last year.
Why Frontline is on the verge of bankruptcy
Industry analysts suggest that investors should avoid Frontline because of the bankruptcy risk. Currently, the company is facing bankruptcy. This is led by the $190 million bond that’s due in April 2015.
Must-know: Baltic Dry Index bouncing from its 52-week low
The Baltic Exchange Dry Bulk Index (BDIY) is a composite of rates for different ship sizes factoring in the average daily earnings of capsize, panama, supramax, and handysize dry bulk transport vessels.
Must-know: Why the crude tanker orderbook is expanding
In order to assess the industry’s fundamental outlook, managers use the oil tanker orderbook. It’s an important yardstick. It includes the number of ships that have been ordered and the number of ships under construction. A rising orderbook usually suggests that oil tankers have a better expectation for future supply and demand dynamics.
Tankships seeks to expand its fleet size through acquisitions
Tankships seeks to expand its fleet size through timely and selective acquisitions of additional secondhand modern tankers and the available optional vessels.
Why the dry bulk shipping industry is weakening
Numerous factors like world economic growth and commodity supply and demand affect the dry bulk shipping industry.
Why Canadian crude exports to the US are on a high
According to the U.S. Energy Information Administration (or EIA), for the week ending September 12, 2014, U.S. crude oil imports from Canada hit a record high of 2.99 million barrels per day (or bpd). This was a 20% increase from the same period last year. Meanwhile, the four-week average on September 12 was 2.93 million bpd.
Outlook for global growth and tanker fleet for Teekay Tankers
Looking ahead to 2015, Teekay Tankers Ltd. (TNK) forecasts 2.0% net global tanker fleet growth with major contribution from the product tanker sector. There is a negative fleet growth estimate for the Suezmax and uncoated Aframax sectors.
Diana Shipping’s Investment Strategy and Market Outlook
Diana Shipping’s investment strategy is to preserve the strength and integrity of its balance sheet and gradually increase its leverage as asset values weaken.
Why the Baltic Dirty Tanker Index going south
Analysts and money managers follow the Baltic Dirty Tanker Index (or BDTI). They follow the Index to assess the crude oil shipping industry’s revenue and earnings potential. The Baltic Dirty Tanker Index decreased to 699 on August 29, 2014. It was 826 at the beginning of the month.
Must know: China’s crude steel production edging upwards
China’s steel production mills are reluctant to reduce output for fear credit could be cut off and market share captured by rival producers.
Why the Baltic Dry Index dipped in November
Despite a decline in fuel prices, the Baltic Dry Index has recorded an approximate 40% drop since the start of November and a 62% decline year-to-date.
Overview: Maintaining a perfect, modern, and young fleet size
SB has paid six additional new eco-design newbuild vessels on order.
Star Bulk comments on coal and grain
Star Bulk believes the recent coal import restrictions were minimal, while the freight rate agreement signing between Australia and China can be a positive development.
Why the fundamental stock analysis is positive for the future
DryShips expects that iron ore production will increase in the next three years, which will increase the demand for transportation.
Why Teekay Tankers has high liquidity and leverage ratios
With TK evolving from a small player to global marine midstream service provider, the company has garnered significant advantages and a strong standing in the industry.
Why declining time charter rates dented revenue
During the quarter, Safe Bulkers operated 31 vessels with a time charter equivalent rate of $11,642—compared to 26 vessels with time charter equivalent rate of $17,116 during 2Q13. The weighted average time charter equivalent of the Baltic Panamax (or BPI) and Baltic Capesize (or BCI) indices stood at $6,846 for 2Q14.
Why maturing contracts are a risk to Navios Maritime Partners
Navios Maritime Partners has a modern, diverse fleet of 32 vessels with 3.3 million DWT and an average age of 7.5 years for its combined fleet.
Depreciation expense increases; Star Bulk addresses capex fund
Star Bulk’s depreciation and interest costs Star Bulk Carriers Corp.’s (SBLK) depreciation expense increased to $10.7 million for the third quarter of 2014, compared to $4.0 million for the third quarter of 2013. The increase was due to the increase in the company’s average number of vessels in its fleet and the corresponding increase in […]
What is Star Bulk’s vessel financing status?
Due to rapid expansion, Star Bulk’s financing levels are higher compared to its industry peers.
Changes in Star Bulk’s management fees and operating and net income
Star Bulk’s management fee income is at $0.3 million compared to $0.5 million for 3Q13, due mainly to a decrease in the number of vessels under management.
Star Bulk’s liquidity and cash flow
This part covers Star Bulk’s cash flow numbers given the company’s rapid expansion of its fleet size through acquisitions and other related developments.
Dry bulk trade demands Star Bulk dynamics
Star Bulk management stated that commodity demand remains healthy, while substantial supply expansion has resulted in surpluses across various commodity markets.
Newbuild prices record marginal change
Newbuild VLCC (very large crude carrier) prices for the month of November 2014 decreased to $97.7 million compared to $98.1 million in October 2014.
Overview: Star Bulk Carriers’ earnings and fleet
Star Bulk Carriers’ fleet includes 52 operating vessels, 16 second-hand vessels yet to be delivered, and 35 newbuilding vessels still under construction.
Perfect timing for Star Bulk’s fleet acquisition
Star Bulk merged with Ocean Bulk in July, right after the high price levels of March weakened. It took advantage of even lower vessel prices in its Excel acquisition in August.
A review of Frontline and its fleet
Frontline Ltd. (FRO) is engaged mainly in the ownership or operation of oil tankers used to transport crude oil. It’s owned by Norwegian shipping magnate John Fredriksen.
Frontline comments on global shipping industry
Frontline recorded better vessel earnings compared to the second quarter. Improved fleet utilization was due to increased travel distance driven by crude moving from the Atlantic Basin to China.
Teekay Tankers: Overview of its earnings and fleet
The revenue mix for Teekay Tankers Ltd. (TNK) is largely contributed by the net pool revenues. The company has developed secured charter-in contracts and created a significant base for the company’s future growth.
Five-year and ten-year VLCC prices increase
With faster deliveries and employment of vessels, secondhand vessels tend to reflect industry participants’ expectations for medium-term fundamentals.
Perfect time for Scorpio Tankers to foray the market
Scorpio Tankers is at the beginning of what could be a strong winter season for product tankers, and the company is extremely well positioned to take advantage of it.
New buyback program approved by Scorpio Tankers
On July 28, 2014, the board of directors of Scorpio Tankers (STNG) approved a new stock buyback program with authorization to purchase up to $150 million of its common stock.
DryShips improves its time charter equivalent and outlook
DryShips notes that it has significant leverage in the dry bulk and tanker spot markets. So, positive developments in these sectors will result in substantial cash flow to its bottom line.
Baltic Dirty Tanker Index gains on rising Chinese imports
The Baltic Dirty Tanker Index interests analysts and money managers. They use it to assess the revenue and earnings potential of the crude oil shipping industry.
5-year-old and 10-year-old VLCC prices stay at consistent levels
Since secondhand vessels can be delivered within a few months, they tend to reflect industry participants’ expectations for medium-term fundamentals and rates, unlike newbuilds, for which two years of delivery time is mandatory.
Why China’s coal and grain trade increased
Coal trade saw significant changes over the past few years. China was a net coal exporter in 2009—only five years ago. Today, it’s the world’s largest importer.
Star Bulk could become largest U.S. dry bulk shipping company
Star Bulk Carriers Corporation (SBLK), a global shipping company focusing on the transportation of dry bulk cargoes, is en route to becoming the largest U.S. listed dry bulk shipping company.
Star Bulk’s countercyclical Excel Maritime acquisition
Star Bulk Carrier’s (SBLK) acquisition from Excel Maritime is well-timed from a short-term and a long-term point of view. The company acquired Panamax/ Kamsarmax vessels at historically low prices, with Panamax vessel prices currently at the lowest level in 2014, a 21% decline compared to its peak in April.
Star Bulk eco fleet and Newcastlemax vessels a benefit for the company
By using Newcastlemax vessels, Star Bulk Carriers Corporation (SBLK) experiences a significant reduction of dollar per ton cost on major routes during a high bunker environment. The benefits of eco are improving cash flow during a high-freight market and downside protection during a low-freight market.
Why Noodles and Company has short and long-term goals
Noodles & Company (or NDLS) has a few initiatives and tactics to drive short-term traffic. It also drives longer-term brand and customer loyalty building.
Why it’s important to understand Noodles and Co.
Noodles & Company (or NDLS) was founded in 1995. It’s a fast-casual restaurant chain that serves classic noodle and pasta dishes.
What is the outlook for the restaurant industry?
In August, the Restaurant Performance Index stood at 101.9, an increase of 1% from July, which was its first gain in three months.
Overview: DryShips’ fleet management and 1Q earnings turnaround
In regards to the management agreement, TMS Bulkers is entitled to a fixed management fee of $2,069 per vessel, per day, payable in equal monthly installments in advance.
Overview: DryShips’ bank compliance and effective balance sheet
As compared to its earlier periods, DryShips’ (DRYS) value to loan compliance situation has improved significantly.
Baltic Dry Index on the downfall with capsize rates down
In trading, the Baltic Dry Index declined to 850 on June 30, 2014, from 934 at the beginning from the month.
Overview: Nordic American Tankers
In the fall of 2004, NAT owned three vessels and at the end of 2013 it owned 20 vessels—Suezmax tankers—with tankers averaging ~156,000 deadweight tonnage (or dwt) each.
Navios Maritime Partners: A must-know company overview
For the first quarter of 2014, Navios Maritime Partners’ revenue rose 14.4% year-over-year to $57.5 million, led by vessel acquisitions.
Why China’s March PMI is positive for dry bulk shippers
China’s official PMI For the month of March, China’s official PMI (purchasing managers’ index) inched up to 50.3 as compared to 50.2 recorded in February, allaying fears of slowdown in the world’s second largest economy and a key driver of dry bulk shipping stocks such as DryShips Inc. (DRYS), Navios Maritime Holdings Inc. (NM), Diana […]
Why increasing Newbuild vessel prices discourages buyers
On a weekly basis, vessel prices indicate the current trading prices of Capesize, Panamax, Supramax, and Handymax vessels. They also indicate the weekly changes.
Crude oil contango and offshore storage
The drastic drop in crude oil prices created a situation in which the price of near-term crude is cheaper than the price of long-term crude.
Baltic Dry Index – Why December dipped in red
The Baltic Dry Index, or BDI, measures the price of transporting dry bulk. It’s a combination of rates for different ship sizes.
Crude steel production run-up affects dry bulk shippers
China’s crude steel production is a key indicator that dry bulk shipping investors should watch. This is mainly due to iron ore primarily being used to manufacture steel.
October dry bulk newbuild ship prices are relatively consistent
An indicator to gauge bulk vessels’ fundamental prospects, ship prices include newbuild vessel prices and second-hand vessel prices.
DHT Holdings’ fleet portfolio and vessels under construction
Most of the vessels in DHT Holdings’ fleet portfolio were built in the year 2000 and onwards. The exception is one vessel that was built in 1999.
Current vessel prices rising
Depending on its size, a tanker takes two to three-plus years to build, with each tanker costing upward of ~$60 million.
US top oil producer; crude imports decline
The US has produced more oil than Saudi Arabia since the fourth quarter of 2012, and the country’s oil production surpassed Russia’s output in 2011.
5- and 10-year VLCC and Suezmax weekly prices on the run-up
Weekly vessel values have been on the rise, with positive week-over-week and significant year-over-year growth.
Monthly crude steel production’s YoY growth – 2014 declined
The National Bureau of Statistics revealed that the December crude steel output in China increased 7.6% to 68.09 million tonnes. Steel output was up 1.5% YoY.
China’s coal imports are rising due to cheaper coal overseas
For 2014, the total coal imports were 291.22 million tonnes—compared to 327.1 million tonnes in 2013. This was after many years of double-digit growth.
Navios Maritime Midstream Partners: Company overview, fleet
Since its listing on November 14, 2014, until January 16, 2015, Navios Maritime Midstream Partners recorded a 4.2% increase in its share price.
Navios Maritime Midstream may enter LPG market
The international LPG shipping market is volatile in profitability, charter rates, and vessel values, adversely affecting businesses during downturns.
Navios Maritime Midstream: Analyst targets, management comments
Angeliki Frangou, head of Navios Group, expects 2015 to be an uncertain period. Factors include anemic growth in Europe and deflationary fears in Japan.
Prudent chartering policy leading to stable growth
For the remainder of 2014, open days for its fleet stands at 64% of anticipated ownership days, 85% in 2015, and 90% in 2016 offering substantial upside potential for revenue.
Analyzing Dry Bulk Vessels’ Orderbook, Supply, and Slippage
In 2014, the newbuilding orderbook for dry bulk carriers reported 746 orders—145 Panamax vessels, 132 Capesize vessels, and 19 VLCCs.
5- and 10-year VLCC Prices Higher in February
Five-year VLCC prices in February increased to $80.9 million from $80.7 million in January. Ten-year VLCC prices fell to $52.2 million from $52.8 million.
Secondhand Vessel Prices Approach 15-Year Lows
Like the cost of newbuilds, secondhand vessel prices are also on the slide. Five-year old Capesize prices dropped to $33.1 million in February 2015.
Newbuild Vessel Prices at Consistent Levels
Newbuild VLCCs are the largest ship used to transport crude oil long distance. According to Lloyds List, buying a newbuild vessel is better than secondhand.
Chinese Crude Steel Production Takes a Break
In the first two months of 2015, China’s crude steel output dropped 0.21% year-over-year to 130.5 million tons, according to government data.
China’s Coal Imports Fall on Quality Inspections and Lower Demand
In 2014, China coal imports dipped year-over-year for the first time in six years. Imports fell 10.9% to 291.6 million tonnes.
China’s Iron Ore Imports Dip on Suspended Construction Activities
China’s iron ore imports declined for the second straight month in February 2015, down 13.5% to 67.94 million tonnes over January 2015.
Diana: Rising Coal Stockpiles Will Likely Hamper Dry Bulk Shipping
Coal stockpiles reached 8 million tons. The continued rise may negatively impact the near-term coal import prospects.
Diana Shipping Expects Chinese Steel Output to Fall in 2015
According to Diana Shipping’s (DSX) management, world crude steel production reached 1.66 billion metric tons in 2014. It was up by 1.2% compared to 2013.
What Investors Should Know about Diana Shipping’s 4Q Earnings
Diana Shipping is a global shipping company. It specializes in dry bulk vessel ownership. It reported the results of its 4Q earnings on March 4, 2015.
Investing in the Dry Bulk Industry: Fleet Supply Analysis
DryShips (DRYS) commented that its total dry bulk fleet’s compound annual growth rate for 2005 to 2014 stood at 9.1%. Its fleet increased by 4.4% in 2014.
DryShips Should Find Support from the Dry Bulk Market Recovery
World Maritime News comments that it expects a fundamental and sustainable dry bulk market recovery in the second half of 2015 and throughout 2016.
A snapshot of Navios Maritime Holdings’ fourth quarter earnings
Navios Maritime Holdings (NM) is a global seaborne shipping and logistics company. It’s focused on the transport and transshipment of dry bulk commodities.
Global growth may drive the shipping industry higher
History reveals that increases in world GDP growth generally led to increases in marine transportation rates. Since June 2014, crude oil prices fell 50%.
Port Hedland’s iron ore exports are on the rise
Shipments through Port Hedland represented 55% of Australia’s iron ore exports last year, and more than 80% of cargoes go to China.
Navios Maritime Partners: Bet on dry bulk depends on world growth
The dry bulk industry is broadly affected by factors like global economic growth, which positively correlates with raw material consumption.
5-year and 10-year VLCCs’ prices are rising
In January 2015, five-year VLCCs’ (very large crude carriers) prices increased to $80.7 million—from $77.1 million in December 2014.
Why China’s coal imports are declining
In 2014, China’s coal imports recorded their first year-over-year dip in six years. Imports dropped 10.9% to 291.2 million tonnes.
Why Brazil’s iron ore export is losing market share to Australia
According to customs data, iron ore exports from Brazil accounted for 18% of China’s overseas purchases in 2014 compared to 19% in 2013.
China’s January PMI is below the expansion level
China’s official purchasing managers’ index (or PMI) declined to 49.8 in January 2015 from its December 2014 levels of 50.1.
The Baltic Dry Index is at its lowest in 3 decades
The Baltic Dry Index slid 0.9% to 554 points on February 9, 2015, the same level it fell to in July and August of 1986.
How have key players in the dry bulk shipping industry performed?
To date in 2015, the Guggenheim Shipping ETF, an index weighted with dry bulk shipping companies, increased 1.3%, while the Baltic Dry Index declined 28.3%.
The tanker market amid the global economy
As the supply of vessels increases in the shipping market, the newbuilds entering the markets affect the tanker market rates.
Nordic’s expanding Suezmax vessel base supports growth
In December 2014, Nordic announced that it had entered into a preliminary agreement to build two Suezmax tankers of 158,000 deadweight tons.