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Monday, 17 December 12
SHIP PRICES TO BOTTOM OUT IN 2013 SAYS GEORGE D. GOURDOMICHALIS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 Ship values especially in older tonnage, or even modern vessels with poor quality are expected to fall further during 2013, with the market as a whole predicted to bottom-out next year, creating the ground for a rebound later on. In an exclusive interview with Hellenic Shipping News Worldwide, Mr. George D. Gourdomichalis, Managing Director of G. Bros Maritime S.A. talks about the dry bulk market's potential in 2013, which ship types appear to have the best value-for-money and debates the effectiveness of the new breed of "Eco-Carriers".
The Gourdomichalis family commenced their own shipowning activities in the London shipping market in 1950's. Since then have enjoyed a very high reputation in the shipping industry. Members of the family have kept high positions in various Boards of Directors and other Official Organizations such as being President of the Union of Greek Shipowners. In 1974 the firm's offices moved to Piraeus, Hellas while still maintaining a presence in London. Since 1990, the family's involvement in shipping has also included a joint venture with the Romanian State Company (Petromin). The Gourdomichalis brothers first independent foray into shipowning and shipmanagement activities was with the family sponsored Joint Venture with the Russian State owned Baltic Shipping Co. which operated under the flag of Baltmed Shipping Co.
In 1996, after having wound up Baltmed Shipping Co., the J.V. with Baltic Shipping Co., George and Stathis Gourdomichalis established Gourdomichalis Naftiki Eteria S.A. The establishment of the company manifested the younger generation's strong drive to succeed using its own means and skills. Since its inception in 1996 it has managed a total of six dry cargo ships including Freedom and Handy type vessels. The company has also managed a repossessed vessel on behalf of a bank.
In 2004 all their activities were consolidated into a holding company FREESEAS INC. and managed by Free Bulkers S.A. Freeseas Inc was listed on NASDAQ on December 2005. George Gourdomichalis held the position of President and Chairman and Stathis Gourdomichalis was the Treasurer and Chief Financial Officer. The two principals controlled about 48% of the listed company. In January 2007 they sold their shareholding in both Freeseas Inc. and Free Bulkers S.A. to entities controlled by the Restis group.
This development allowed George and Stathis to once again grow their "private - family" shipping activities. A new structure was put into operation under the name G Bros Maritime S.A. They employ a total of sixteen shore-based staff including a Port Captain, Engineer Superintendent, Accountants, Secretarial and Administrative Executive staff. The company occupies approximately 300 sq. meters of office space in prime area on Akti Miaouli, Piraeus, at the heart of the worlds largest shipping center.
This year's performance of the dry bulk market has been less than memorable, in fact quite the opposite. Why did this happen, especially after a satisfying 2011, at least in terms of freight rates?
The softness of the dry bulk market is clearly a function of the imbalance of tonnage supply and demand, world GDP growth slowdown experienced over the past couple of years and the lack of finance. We fail to see any satisfaction in 2011 in freight rates and values and would suggest that the dry bulk market downturn we are experiencing essentially since end 2008, with a short breather in the spring of 2010, is a prolonged down run of the market.
Do you expect 2013 to be just as challenging, or could conditions improve, as a result of an improvement of the supply/demand current imbalance, a product of heavy new building ordering of the past few years?
As stated above there are three basic reasons pressuring freight rates and values down, whereas the supply/demand balance is slowly starting to look better, there is still significant danger of continued oversupply of tonnage on the back of the very strong marketing of the supposedly “eco-ships” by yards lacking utilization. The coming year will be as challenging as 2012, but will also see the market bottom out thus creating the opportunity for purchases and positioning for a upturn.
What strategy did your company follow, in order to cope with these adverse market conditions?
We, as many others, restructured our fleet by retiring older tonnage and restructuring financial arrangements, as well as disposing of vessels with heavier than acceptable debt. In reality, we exercised a stop-loss strategy allowing us to weather the down market.
Do you thinks that ships' values are close to bottoming-out, or is there still room for lower prices?
Vessel values are a function of earnings and replacement value and as such there are certain segments and age groups that may have further down side with overage tonnage in the larger sizes being the most prominent in that group. Having said that, older tonnage across the board has further downside as it is trading at scrap related values. We also believe that younger tonnage of questionable and inferior quality has considerable down side, being that in a buyer’s market one tends to cherry pick the best of the candidates.
Which ship types do you find the most attractive in today's market?
The answer depends on the driver behind purchases, i.e. is it a speculative asset play, or an operational longer term investment? In the case of the first, we would be inclined to look at the very large modern units, whereas in the case of the latter we would look at the modern high quality/high spec handy and handy-max segment.
Do you prefer newbuilding investments, or is it better to look for modern second hand tonnage in today's market environment?
We believe that quality of design and build is paramount these days and as such would rule out any new-building activity at inferior yards. Having said that, the discount to replacement cost found in today’s market leads us to believe that very attractive valuations can be found in top quality modern second hand vessels.
How different are today's conditions in shipping finance, compared to the pre-2009 period? Is it challenging to obtain financing for new vessel acquisitions?
Immensely!! There is practically no finance available except from very select institutions to very select borrowers either by virtue of being existing clients and/or by virtue of paying down existing facilities and thus opening up credit and to the larger corporate entities who are borrowing both on the strength of their balance sheets but also on the strength of their cash flows and cash in hand. Naturally, there are certain segments that are faring better than other in obtaining finance such as the LNG and offshore industries as well as the re-appearance of quasi financial institutions providing higher cost finance. In all though, margins are up, loan to value ratios are down and security is paramount to lenders.
Do you believe that the latest trend of the so-called "Eco Carriers", i.e. ships which promise lower fuel consumption will become dominant in the future, despite the premium prices they command? Are you considering investing in such vessels in the future?
The response of any educated and experienced shipping man is that the plethora of “eco-carrier” designs are untested and make claims that have not yet been put to the test and rigors of the real sea. A properly designed, maintained and operated existing ship can provide good competition to any of the new designs and we believe it is best to reserve judgment till these designs are put to the test.
One of the major concerns of the global shipping industry has also been piracy in various areas around the world. How do you protect your vessels? Which is the best solution in your opinion?
We, as others, have been forced to employ armed guards onboard our vessels transiting/trading in high risk areas. It is not a solution to the problem but is a necessary evil. The solution lies in the geopolitical balances that need to be juggled in Somalia and/or in West Africa and/or S.E. Asia. We hope, primarily for the safety of our crews and the free flow of trade that a final solution both on shore and at sea is found the soonest possible.
Source : Nikos Roussanoglou, Hellenic Shipping News Worldwide
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Thursday, 29 November 12
BUMI TO PRODUCE 100 MILLION TONS OF COAL BY 2014
COALspot.com - Expansions on both BUMI’ s subsidiaries, PT Kaltim Prima Coal (KPC) and PT Arutmin Indonesia ( Arutmin) , are ...
Thursday, 29 November 12
PANAMAX : A FAIRLY STEADY MARKET WITH USD 8.5-9K/DAY FOR 2 LADEN LEGS IN ATLANTIC - FEARNLEYS
Handy
The Atlantic market continues to remain quiet due to more supply of ships. Rates from USG to Far East were around USD 18k and Black Sea to Fa ...
Thursday, 29 November 12
DRY BULK MARKET SLIGHTLY HIGHER DESPITE LULL ACTIVITY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market was marginally higher yesterday, according to the industry's benchmark, the Baltic Dry Index (BDI), which rose by 7 points to 1 ...
Wednesday, 28 November 12
NEWBUILDING ORDERING PICKS UP AS SHIP OWNERS LOOK TO CLOSE DEALS BEFORE THE END OF THE YEAR - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Ship owners are active once again in the newbuilding ordering market, as they look to clinch deals ahead of the end of the year. Once again their fo ...
Tuesday, 27 November 12
NEWCASTLE PORT HAS SHIPPED 1.79 MILLION TONS OF COAL W/E 26 NOVEMBER
COALspot.com - Newcastle port in Australia has loaded 1,793,841 MT of thermal and coking coal for week ended 0700 hours 26 November 2012, Newc ...
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Showing 4481 to 4485 news of total 6871 |
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- Indo Tambangraya Megah - Indonesia
- Sojitz Corporation - Japan
- GN Power Mariveles Coal Plant, Philippines
- Iligan Light & Power Inc, Philippines
- Metalloyd Limited - United Kingdom
- Mintek Dendrill Indonesia
- Port Waratah Coal Services - Australia
- Bharathi Cement Corporation - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Jaiprakash Power Ventures ltd
- Alfred C Toepfer International GmbH - Germany
- Bhushan Steel Limited - India
- Vizag Seaport Private Limited - India
- VISA Power Limited - India
- Renaissance Capital - South Africa
- Price Waterhouse Coopers - Russia
- Chamber of Mines of South Africa
- Karbindo Abesyapradhi - Indoneisa
- Sical Logistics Limited - India
- White Energy Company Limited
- Banpu Public Company Limited - Thailand
- Sinarmas Energy and Mining - Indonesia
- Dalmia Cement Bharat India
- Rio Tinto Coal - Australia
- Gujarat Sidhee Cement - India
- Pendopo Energi Batubara - Indonesia
- Thai Mozambique Logistica
- CNBM International Corporation - China
- Tata Chemicals Ltd - India
- Independent Power Producers Association of India
- Miang Besar Coal Terminal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Toyota Tsusho Corporation, Japan
- Larsen & Toubro Limited - India
- TeaM Sual Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Africa Commodities Group - South Africa
- Makarim & Taira - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- New Zealand Coal & Carbon
- Grasim Industreis Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Binh Thuan Hamico - Vietnam
- Kepco SPC Power Corporation, Philippines
- Planning Commission, India
- Kohat Cement Company Ltd. - Pakistan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Simpson Spence & Young - Indonesia
- McConnell Dowell - Australia
- Bangladesh Power Developement Board
- Malabar Cements Ltd - India
- Wood Mackenzie - Singapore
- Power Finance Corporation Ltd., India
- Goldman Sachs - Singapore
- GAC Shipping (India) Pvt Ltd
- IEA Clean Coal Centre - UK
- Mercuria Energy - Indonesia
- Central Java Power - Indonesia
- Kideco Jaya Agung - Indonesia
- PTC India Limited - India
- Energy Link Ltd, New Zealand
- Global Business Power Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Deloitte Consulting - India
- Madhucon Powers Ltd - India
- Eastern Coal Council - USA
- ICICI Bank Limited - India
- Georgia Ports Authority, United States
- Manunggal Multi Energi - Indonesia
- Cement Manufacturers Association - India
- Holcim Trading Pte Ltd - Singapore
- Trasteel International SA, Italy
- Maharashtra Electricity Regulatory Commission - India
- Meenaskhi Energy Private Limited - India
- Ministry of Mines - Canada
- Samtan Co., Ltd - South Korea
- PNOC Exploration Corporation - Philippines
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Indika Energy - Indonesia
- Commonwealth Bank - Australia
- Ministry of Transport, Egypt
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kumho Petrochemical, South Korea
- Economic Council, Georgia
- Asmin Koalindo Tuhup - Indonesia
- Sindya Power Generating Company Private Ltd
- Ambuja Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Siam City Cement PLC, Thailand
- Videocon Industries ltd - India
- Meralco Power Generation, Philippines
- GMR Energy Limited - India
- ASAPP Information Group - India
- The State Trading Corporation of India Ltd
- Ceylon Electricity Board - Sri Lanka
- Bhoruka Overseas - Indonesia
- Heidelberg Cement - Germany
- Petron Corporation, Philippines
- Mjunction Services Limited - India
- Timah Investasi Mineral - Indoneisa
- International Coal Ventures Pvt Ltd - India
- Star Paper Mills Limited - India
- Altura Mining Limited, Indonesia
- Riau Bara Harum - Indonesia
- Bayan Resources Tbk. - Indonesia
- Indogreen Group - Indonesia
- Australian Coal Association
- Directorate General of MIneral and Coal - Indonesia
- Edison Trading Spa - Italy
- PetroVietnam Power Coal Import and Supply Company
- Bahari Cakrawala Sebuku - Indonesia
- Eastern Energy - Thailand
- Global Green Power PLC Corporation, Philippines
- Electricity Generating Authority of Thailand
- Sarangani Energy Corporation, Philippines
- Mercator Lines Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Carbofer General Trading SA - India
- CIMB Investment Bank - Malaysia
- Bukit Baiduri Energy - Indonesia
- Electricity Authority, New Zealand
- Orica Mining Services - Indonesia
- Coalindo Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- The Treasury - Australian Government
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Lanco Infratech Ltd - India
- Merrill Lynch Commodities Europe
- IHS Mccloskey Coal Group - USA
- GVK Power & Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Aditya Birla Group - India
- Latin American Coal - Colombia
- Karaikal Port Pvt Ltd - India
- Singapore Mercantile Exchange
- Kartika Selabumi Mining - Indonesia
- Orica Australia Pty. Ltd.
- Interocean Group of Companies - India
- Rashtriya Ispat Nigam Limited - India
- The University of Queensland
- Parry Sugars Refinery, India
- Antam Resourcindo - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Aboitiz Power Corporation - Philippines
- Uttam Galva Steels Limited - India
- Borneo Indobara - Indonesia
- Indonesian Coal Mining Association
- Vedanta Resources Plc - India
- Minerals Council of Australia
- Bukit Makmur.PT - Indonesia
- Cigading International Bulk Terminal - Indonesia
- MS Steel International - UAE
- Wilmar Investment Holdings
- Bhatia International Limited - India
- SMG Consultants - Indonesia
- London Commodity Brokers - England
- Siam City Cement - Thailand
- Savvy Resources Ltd - HongKong
- Indian Oil Corporation Limited
- Thiess Contractors Indonesia
- San Jose City I Power Corp, Philippines
- Oldendorff Carriers - Singapore
- Sakthi Sugars Limited - India
- Australian Commodity Traders Exchange
- Medco Energi Mining Internasional
- Attock Cement Pakistan Limited
- Posco Energy - South Korea
- Kobexindo Tractors - Indoneisa
- Xindia Steels Limited - India
- Bulk Trading Sa - Switzerland
- Parliament of New Zealand
- Maheswari Brothers Coal Limited - India
- Global Coal Blending Company Limited - Australia
- Jindal Steel & Power Ltd - India
- Marubeni Corporation - India
- Semirara Mining Corp, Philippines
- Salva Resources Pvt Ltd - India
- Central Electricity Authority - India
- Romanian Commodities Exchange
- Neyveli Lignite Corporation Ltd, - India
- Baramulti Group, Indonesia
- Ministry of Finance - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Standard Chartered Bank - UAE
- Anglo American - United Kingdom
- Coastal Gujarat Power Limited - India
- Coal and Oil Company - UAE
- Therma Luzon, Inc, Philippines
- Tamil Nadu electricity Board
- Ind-Barath Power Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Globalindo Alam Lestari - Indonesia
- Barasentosa Lestari - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Kapuas Tunggal Persada - Indonesia
- Semirara Mining and Power Corporation, Philippines
- India Bulls Power Limited - India
- Sree Jayajothi Cements Limited - India
- European Bulk Services B.V. - Netherlands
- Agrawal Coal Company - India
- Intertek Mineral Services - Indonesia
- PowerSource Philippines DevCo
- Energy Development Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Chettinad Cement Corporation Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- SMC Global Power, Philippines
- LBH Netherlands Bv - Netherlands
- Indian Energy Exchange, India
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