Eagle Bulk Shipping Inc
China’s Crude Steel Production Fell in May: Outlook Is Negative
According to data released on May 22, world steel production fell by 2.1% YoY in May. China’s steel production also fell by 1.6% YoY on a YTD basis.
China’s Manufacturing PMI Is the Lowest in 1 Year
China’s HSBC manufacturing PMI fell to 48.9 in April. This is the lowest level since April 2014. A reading below 50 indicates contraction.
Declining Iron Ore Port Inventory: Could It Be Positive?
Chinese ports’ iron ore inventory levels can impact purchasing decisions. Iron ore is the largest category of product shipment within the dry bulk shipping industry.
Falling Dry Bulk Orderbook: Positive for Dry Bulk Shippers
If the orderbook level continues to fall more from this point and demand continues to grow, we could see some life in dry bulk shipping rates and equities.
Secondhand Vessel Prices Continue to Fall
Secondhand vessels are delivered faster than newbuilds. As a result, secondhand vessels represent more of the short to medium-term outlook.
How China’s slow real estate markets hurt the shipping industry
Accounting for almost 20% of gross domestic product (or GDP), China’s real estate sector plays a major role in the country’s economic activity.
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.
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.
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.
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.
What is Star Bulk’s vessel financing status?
Due to rapid expansion, Star Bulk’s financing levels are higher compared to its industry peers.
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 […]
A growing fleet increases Star Bulk’s voyage revenues
For 3Q14, Star Bulk recorded total voyage revenues of $36.5 million compared to $17.3 million for 3Q13. This increase is due mainly to its growing fleet.
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.
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.
Grain trade outlook may boost Star Bulk’s vessel demand
During the second half of 2014, Star Bulk Carrier Corp (SBLK) might experience a combination of healthy U.S. exports. If the estimated scenario is correct, the Panamax and Supermax will enjoy increased exports and significantly boost vessel demand.
Star Bulk comments on Chinese and Indian coal markets
Star Bulk Carriers Corporation (SBLK) remains confident that imports will produce strong ton miles growth during the medium term due to substitution of poor quality short-distance imports with high-quality long hauls.
China’s iron ore market dynamics: A positive for Star Bulk
Star Bulk (SBLK) believes that the substitution of expensive Chinese iron ore production with imported iron ore can provide a significant support to iron ore trade, even with zero steel production growth.
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.
Second quarter expenses on the rise with expanding vessel base
Star Bulk’s vessel operating expenses totaled $8.1 million, compared to $6.8 million in year ago quarter. This was due to a higher average number of vessels in the second quarter of 2014 compared to the second quarter of 2013.
Newbuilding program means stable outlook for Star Bulk
Going forward, Star Bulk Carriers’ (SBLK) focus remains on integrating the newly acquired fleet into its highly efficient platform. It will also continue to monitor and assess the market for further accretive growth opportunities.
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 merges with Oceanbulk, Heron, and Pappas
In the merger, Star Bulk issued a total of 54.1 million common shares to the entities involved, of which 45.5 million shares (61.3% shareholding) were issued to Oaktree and 8.6 million (12.6% shareholding) were issued to Pappas shareholders.
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 overview: Fleet and business strategy
Star Bulk’s fleet profile enables it to serve its customers in both major and minor bulk trades, and its vessels are able to trade worldwide in a multitude of trade routes carrying a wide range of cargo.
China’s decrease in real estate sales show weak market conditions
In order to support the housing sector, Beijing planned cuts in taxes and loosened monetary policy to ramp up activity in the sector.
Below-average Real Estate Climate Index is positive for shipping
The significance of the real estate climate index The last indicator that investors could use to get an understanding of the real estate situation in China is the Real Estate Climate Index. The National Bureau of Statistics developed this index to capture the trends and situation in the property market using eight indicators related to […]
Dry bulk shipping weekly analysis (Part 10: Ship prices)
Continued from Part 9 Why should you watch ship purchase prices? Purchase prices for ships are often good indicators of financial health in the shipping industry. When shipping demand grows more than the supply of ships, shipping companies place additional orders, which drives up purchase prices. Plus, when firms are able to charge higher prices […]
Dry bulk shipping weekly analysis (Part 3: Construction rises)
Continued from Part 2 Ship construction activity Part 2 of this series explains how ship orders can illustrate managers’ expectations for future supply and demand differentials. But new ship orders don’t always translate into new constructions right away. Sometimes, shipping firms specify a particular date of delivery for the new orders. If the delivery date is farther […]
Market Realist dry bulk shipping blast (Part 5: Shipping rates)
Continued from Part 4 Supply and demand drives dry bulk shipping companies Although we must analyze demand in order to project future dry bulk shipping rates, imports data aren’t widely available on a weekly basis. But shipping rates, which reflect the difference in demand and supply, are collected on a daily basis at the London-based Baltic […]
Why iron ore prices rising to two-month high is positive for dry bulk shippers
Commodity prices and shipping Commodity prices are leading indicators of an economic cycle. Because suppliers of raw materials require time to ramp up production, an increase in demand during an economic expansion will often lead to higher prices. As a result, commodity prices correlate highly with shipping. Iron ore prices On July 25, the price […]
Thermal coal inventory rolling over, negative implication for dry bulk shippers
Inventory levels and shipping rates Inventory levels for thermal coal at Chinese ports reflect the safety net that companies decide to hold, as well as the difference in expected and actual demand. When inventory falls to a specific amount, imports often rise as companies seek to replenish stock. Higher imports cause higher shipping rates (in […]
Why the low inventory-to-production ratio supports iron ore imports and shippers
Why inventory data is important Iron ore inventory at Chinese ports reflects the safety net and the imbalance between iron ore supply and steel mill’s demand. When inventory levels are high, they reflect possible overpurchase by importers, which may prompt them to cut back on imports in order to lighten up inventory in the near […]
Why China’s bear case economic growth will hurt dry bulk stocks (Part 3)
Continued from Part 2 Credit default swap and the Chinese economy Credit default swap (CDS) is an instrument investors use to protect a debt investment from defaulting over a specific period in exchange for a payment. Like insurance, the price of a credit default swap depends on the expected likelihood of default. When the probability […]
Why you should watch 7 key industry indicators for shipping fundamentals (Part 4)
Continued from Part 1 Ship retirement can indicate excess capacity The rate at which companies retire ships often reveals whether the dry bulk shipping industry is facing excess capacity or not. When excess capacity pressures the shipping industry, firms will often retire older ships to alleviate pressure on shipping rates and maintenance costs. Nonetheless, high […]
Why you should watch 7 key industry indicators for shipping fundamentals (Part 3)
Continued from Part 1 Ship construction activity Part 2 of this series explains how ship orders can illustrate managers’ expectations for future supply and demand differentials. But new ship orders don’t always translate into new constructions right away. Sometimes, shipping firms specify a specific date of delivery for the new orders. If the delivery date […]
Why you should watch 7 key industry indicators for shipping fundamentals (Part 1)
Dry bulk shipping companies lag behind economic recovery Despite the U.S. stock market surpassing its 2008 highs recently, with the Dow Jones Industrial Index hitting 15,464.30 and S&P 500 hitting 1,680.19 as of July 12, 2013, dry bulk shipping companies have done poorly. These companies primarily transport raw materials such as iron ore, coal, and […]
Why credit default swap affects dry bulk shipping stocks (Part 2)
Continued from Part 1 Is the risk of China’s economic collapse over? The recent decline in credit default swap (CDS) prices reflects a sense that there’s less probability China’s economy will collapse, as the central bank injected capital into banks to bring the interbank repo rates down. But is the risk over? History suggests not […]
Why China remains a risk for dry bulks as bank interest rate stays above average
The impact of China’s financial industry The financial industry is an essential part of any economy. Without a stable financial system—one that supplies liquidity to businesses and individuals and bridges the gap between savers and borrowers—an economy can’t function as efficiently and productively as it could. So a collapse in China’s financial industry would grind […]
Must-know: Commodity prices and dry bulk shipping stocks (Part 1: Inflation and steel)
Inflation, the economy, and shipping Commodity prices often rise when growth in demand exceeds growth in supply. This generally happens during the recovery or expansionary stage of an economic cycle, because producers are often unable to keep up with the rapid increase in orders. So inflation is often a positive indicator of economic health, which […]
Why China’s interbank rates have an impact on dry bulk shipping companies
The impact of China’s financial industry The financial industry is an essential part of any economy. Without a stable financial system—one that supplies liquidity to businesses and individuals and bridges the gap between savers and borrowers—an economy can’t function as efficiently and productively as it could. So, a collapse in China’s financial industry would grind […]
Ship prices rise to 8-month high, supporting dry bulk shipping recovery
Why should you watch ship purchase prices? Purchase prices for ships are often good indicators of financial health in the shipping industry. When shipping demand grows more than the supply of ships, shipping companies place additional orders, which drives up purchase prices. Additionally, when firms are able to charge higher prices for transporting goods across […]
China’s interbank lending rate falls below 6.0%, positive for dry bulk shipping?
Update to Must-know: Shipping companies hit by China’s financial woes The impact of China’s financial industry The financial industry is an essential part of any economy. Without a stable financial system—one that supplies liquidity to businesses and individuals and bridges the gap between savers and borrowers—an economy can’t function as efficiently and productively as it […]
Dry bulk shipping rates rise due to restocking, but likely downside looming
The dry bulk shipping industry’s service is commoditized. So, supply and demand balance is one of the most important drivers for dry bulk companies’ top- and bottom-line performances.
Shipping capacity growth breaks below 7%, first time since 2009
Why is capacity important? Capacity is an important factor that directly impacts companies’ top line (revenue) in a highly commoditized industry, like shipping. When capacity grows faster than what’s demanded, competition rises among individual shipping firms as they try to use idle ships and cover fixed costs. This lowers day rates, which negatively affects bottom […]
Low inflation supports availability of monetary stimulus, positive for shipping stocks
Inflation’s impact on spending and investment Central banks often set a target on inflation rate because a mild inflation rate encourages people to spend more, while it also points out that demand is rising more than supply—a situation that suggests a growing economy. When inflation is high, however, central banks will use monetary policies to […]
Shipping industry recovery is real, but timing remains uncertain
Ship orders reflect managers’ assessments of the industry’s future demand and supply balance. Dry bulk shipping companies will often place new orders when future demand is expected to increase more than supply, on the condition that they expect to generate profits with new vessels.[1. Dry bulk shipping companies engage in the transportation of dry raw […]
Panamax vessel price reveals low dry bulk orders, negative implication
The price of a Panamax ship depends on two factors: the amount of cash the ship can generate within its useful life and the cost of steel.