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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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Monday, 12 November 12
DRILLING COMPLETED AT THE MOORLANDS DEPOSIT, WEST BOWEN PROJECT
Press Release - Cuesta Coal Limited (ASX: CQC) (“Cuesta”) is pleased to announce it has completed its exploration activities at the Moor ...
Monday, 12 November 12
BARGE-LOAD OF 5K TONNES OF COAL FROM THE ADK JOINT VENTURE SHIPPED LAST WEEK
COALspot.com - Orpheus Energy (ASX:OEG) has announced that, it has successfully shipped a 5,000 tonne of ADK thermal coal to an Indonesian trading g ...
Sunday, 11 November 12
AN OPTIMISTIC WEEK FOR INDONESIAN SUB-BIT COAL
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for January 2013 delivery gains 2.08 percent WoW and 1.28 percent DoD on Friday, 9 November ...
Sunday, 11 November 12
THE IRON ORE AND COAL PRICES MOVEMENTS REMAINS LOW - VISTAAR
COALspot.com The market remained soft with all the sectors soft.
The BDI and was down by 4.67 pct closing at 940 points, on Friday 9 Novemb ...
Friday, 09 November 12
SHIP OWNERS TURN TO SECOND HAND VESSELS, WHICH COME AT ATTRACTIVE PRICES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The attractiveness of modern second hand vessels, which are often priced aggressively can't be ignored by cash-rich ship owners, who are taking adv ...
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Showing 4506 to 4510 news of total 6871 |
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- Indogreen Group - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Energy Development Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- Orica Australia Pty. Ltd.
- Eastern Coal Council - USA
- GAC Shipping (India) Pvt Ltd
- Banpu Public Company Limited - Thailand
- Meenaskhi Energy Private Limited - India
- LBH Netherlands Bv - Netherlands
- Tamil Nadu electricity Board
- London Commodity Brokers - England
- Pipit Mutiara Jaya. PT, Indonesia
- Bhatia International Limited - India
- South Luzon Thermal Energy Corporation
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- International Coal Ventures Pvt Ltd - India
- Riau Bara Harum - Indonesia
- SMC Global Power, Philippines
- ICICI Bank Limited - India
- Straits Asia Resources Limited - Singapore
- Cigading International Bulk Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Goldman Sachs - Singapore
- Central Electricity Authority - India
- The Treasury - Australian Government
- McConnell Dowell - Australia
- Iligan Light & Power Inc, Philippines
- Bulk Trading Sa - Switzerland
- Indonesian Coal Mining Association
- Grasim Industreis Ltd - India
- Marubeni Corporation - India
- PTC India Limited - India
- Oldendorff Carriers - Singapore
- Vedanta Resources Plc - India
- Global Coal Blending Company Limited - Australia
- Kalimantan Lumbung Energi - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- Standard Chartered Bank - UAE
- Posco Energy - South Korea
- GMR Energy Limited - India
- Kaltim Prima Coal - Indonesia
- PowerSource Philippines DevCo
- Energy Link Ltd, New Zealand
- Sojitz Corporation - Japan
- Edison Trading Spa - Italy
- Manunggal Multi Energi - Indonesia
- Renaissance Capital - South Africa
- Toyota Tsusho Corporation, Japan
- Coalindo Energy - Indonesia
- Indian Oil Corporation Limited
- Metalloyd Limited - United Kingdom
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- IEA Clean Coal Centre - UK
- Aditya Birla Group - India
- Bhushan Steel Limited - India
- Eastern Energy - Thailand
- Global Green Power PLC Corporation, Philippines
- Thai Mozambique Logistica
- Bhoruka Overseas - Indonesia
- Ministry of Transport, Egypt
- Australian Commodity Traders Exchange
- Global Business Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Krishnapatnam Port Company Ltd. - India
- OPG Power Generation Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Star Paper Mills Limited - India
- ASAPP Information Group - India
- Sical Logistics Limited - India
- Billiton Holdings Pty Ltd - Australia
- Mercator Lines Limited - India
- Romanian Commodities Exchange
- Borneo Indobara - Indonesia
- Lanco Infratech Ltd - India
- Wood Mackenzie - Singapore
- Bharathi Cement Corporation - India
- Intertek Mineral Services - Indonesia
- Thiess Contractors Indonesia
- Ambuja Cements Ltd - India
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- IHS Mccloskey Coal Group - USA
- Bayan Resources Tbk. - Indonesia
- Minerals Council of Australia
- Antam Resourcindo - Indonesia
- Bangladesh Power Developement Board
- CIMB Investment Bank - Malaysia
- Meralco Power Generation, Philippines
- Singapore Mercantile Exchange
- Kartika Selabumi Mining - Indonesia
- SN Aboitiz Power Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Kapuas Tunggal Persada - Indonesia
- European Bulk Services B.V. - Netherlands
- Jorong Barutama Greston.PT - Indonesia
- Malabar Cements Ltd - India
- Savvy Resources Ltd - HongKong
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Heidelberg Cement - Germany
- Bukit Makmur.PT - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Independent Power Producers Association of India
- Baramulti Group, Indonesia
- Petron Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Mercuria Energy - Indonesia
- Parliament of New Zealand
- Electricity Generating Authority of Thailand
- Parry Sugars Refinery, India
- Kobexindo Tractors - Indoneisa
- Jindal Steel & Power Ltd - India
- Kideco Jaya Agung - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Vijayanagar Sugar Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Globalindo Alam Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Karaikal Port Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Economic Council, Georgia
- Merrill Lynch Commodities Europe
- Kepco SPC Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Electricity Authority, New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Chamber of Mines of South Africa
- Sakthi Sugars Limited - India
- Port Waratah Coal Services - Australia
- Uttam Galva Steels Limited - India
- Directorate Of Revenue Intelligence - India
- VISA Power Limited - India
- Cement Manufacturers Association - India
- Gujarat Electricity Regulatory Commission - India
- Alfred C Toepfer International GmbH - Germany
- Georgia Ports Authority, United States
- Coal and Oil Company - UAE
- Barasentosa Lestari - Indonesia
- The State Trading Corporation of India Ltd
- Tata Chemicals Ltd - India
- Altura Mining Limited, Indonesia
- The University of Queensland
- TeaM Sual Corporation - Philippines
- Gujarat Sidhee Cement - India
- Maharashtra Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Timah Investasi Mineral - Indoneisa
- Rio Tinto Coal - Australia
- Attock Cement Pakistan Limited
- Mintek Dendrill Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Makarim & Taira - Indonesia
- Power Finance Corporation Ltd., India
- Central Java Power - Indonesia
- Xindia Steels Limited - India
- Therma Luzon, Inc, Philippines
- Larsen & Toubro Limited - India
- Interocean Group of Companies - India
- Ministry of Finance - Indonesia
- Agrawal Coal Company - India
- Siam City Cement - Thailand
- Kumho Petrochemical, South Korea
- CNBM International Corporation - China
- Price Waterhouse Coopers - Russia
- Ind-Barath Power Infra Limited - India
- Aboitiz Power Corporation - Philippines
- GVK Power & Infra Limited - India
- Videocon Industries ltd - India
- Sarangani Energy Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Maheswari Brothers Coal Limited - India
- Australian Coal Association
- Ceylon Electricity Board - Sri Lanka
- Deloitte Consulting - India
- Leighton Contractors Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- Madhucon Powers Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Essar Steel Hazira Ltd - India
- Orica Mining Services - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Latin American Coal - Colombia
- San Jose City I Power Corp, Philippines
- Indo Tambangraya Megah - Indonesia
- White Energy Company Limited
- Mjunction Services Limited - India
- Wilmar Investment Holdings
- Dalmia Cement Bharat India
- Siam City Cement PLC, Thailand
- Samtan Co., Ltd - South Korea
- MS Steel International - UAE
- Jaiprakash Power Ventures ltd
- Semirara Mining Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Africa Commodities Group - South Africa
- Planning Commission, India
- New Zealand Coal & Carbon
- Ministry of Mines - Canada
- Indian Energy Exchange, India
- Commonwealth Bank - Australia
- Binh Thuan Hamico - Vietnam
- Vizag Seaport Private Limited - India
- SMG Consultants - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Anglo American - United Kingdom
- Trasteel International SA, Italy
- India Bulls Power Limited - India
- Holcim Trading Pte Ltd - Singapore
- Semirara Mining and Power Corporation, Philippines
- Carbofer General Trading SA - India
- Bank of Tokyo Mitsubishi UFJ Ltd
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