We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Thursday, 04 August 16
BREXIT: IMPLICATIONS FOR GLOBAL SHIPPING AND SEA TRADE - EVERSHEDS
 The buzzword for the post-Brexit landscape both in Europe and further afield is ‘uncertainty’. No-one really knows the long term effect that Brexit will have on local and global economies. However, as the dust settles following the referendum, market experts, industry analysts and businesses are assessing the position with cooler heads and so, whilst certainty may be a little way off, more concrete predictions and assertions of intent are beginning to emerge. This is evident daily in commentary and news from the shipping and sea trade sector.
Global impact
The international shipping market is fuelled by trade, which in turn depends on the health of the global economy. The Brexit vote landed at a time when the shipping market, particularly in certain sectors like bulk freight, was already extremely challenging. The factors which have contributed to dry bulk freight rates heading towards all-time lows in Q1 2016 reflect long term issues which would have persisted whatever the referendum result. These factors include oversupply of ships and the effect on global trade of the rebalancing of the Chinese economy following the boom of the last decade.
Sea trade in and out of the UK accounts for only a very small fraction of global shipping activity and therefore an isolated post-Brexit slowdown in the UK economy may be unlikely to impact dramatically on global freight volumes. This is reflected in some of the bullish reaction we have seen from industry players in recent weeks. Euronav’s chief executive was quoted in Lloyd’s List as saying, on a conference call for analysts: “It should be largely speaking something of a non-event in terms of impact on global trade for crude oil.” For companies with income denominated in US Dollars, which will be the case for many international shipping companies, it could be temporarily beneficial, particularly if costs are in euros and sterling. Others comment that potential constraints in available finance, arising from the Brexit vote, may contribute to a longer term upturn in the market, in terms of helping address the current oversupply of vessels.
However, not all commentators are as optimistic. Whilst there seems generally to be agreement that the Brexit vote alone will not be hugely impactful on world trade, the consequences could be amplified when combined with other matters currently playing themselves out on the world stage. Tradewinds reported this week that Wells Fargo analyst Michael Webber, who covers shipping stocks for the bank, said that the combination of the rise of Donald Trump as the Republican nominee to the White House, the Brexit vote, uncertainty around Italy’s banks and the coup attempt in Turkey could create “meaningful tail risk” for crude demand expectations in the second half of the year. If this prediction is accurate, it is likely to impact on demand for tanker shipping services and therefore freight rates.
The shipping industry, particularly the dry bulk and container sectors, is facing other macro threats to its existence in the longer term, which are completely unrelated to the Brexit vote. The rise of the digital economy and more widespread use of technology in logistics (for example drone deliveries) and the consumer sector (for example 3D printing) may impact on the longterm need for the same volume of goods to be carried by sea.
UK impact
UK trade will clearly be impacted by the Brexit vote. We saw an immediate effect on currency and share prices, although there are signs that the market is settling down after the initial post-vote furore. In terms of longer term impact, there are some matters which are already tolerably clear, for example that any changes to the cost of trade with the EU are likely to affect freight volumes at British ports. However, the precise nature and extent of the effect on UK trade will depend entirely on the form of relationship which is ultimately agreed both with the EU and with other trading partners. With the new British Prime Minister, Theresa May, looking to defer triggering Article 50 until 2017, that form of relationship remains pretty ‘uncertain’.
There are wider potential outcomes for shipping in the UK beyond the direct effect on trade volumes. In terms of the UK offshore industry, for example, Tradewinds reported recently that “when news of the UK’s decision to exit the EU hit the offshore sector, most analysts agreed that the longer-term damage for the sector would be from a possible slowdown in the world’s economy. However, some warned the immediate and near-term effect would be that oil companies would obviously put the brakes on much-needed investment in the UK. The UK continental shelf (UKCS) is already suffering from record low investment — at one-eighth the value of the annual average over the past five years — and the nation’s oil-and-gas sector is on course to have lost up to 140,000 jobs by the end of this year.”
There is also the UK’s position as a leading provider of maritime professional services to consider. The marine insurance industry is pushing hard to maintain the passporting rights currently enjoyed between EU member states, although whether this will be possible without full access to the single market (and the associated EU requirements for free movement of workers) is set to be the key topic in negotiations.
In terms of other professional services, such as legal and shipbroking services, there is some speculation that UK’s so called “stability premium” may have been affected by the vote. However, the UK’s long maritime history, the reputation of its courts (which rely on an extremely well established body of specialist case law) and institutions and the number of highly qualified individuals resident in the UK working in the sector should help ameliorate any effect on this premium at least whilst Brexit is negotiated. However, even if the premium remains intact the professional services sector may be rightly concerned about how services are dealt with in negotiating future trade deals. Such agreements traditionally focus on trade in goods and therefore may not be as advantageous to the services sector.
Conclusion
The global shipping market is experiencing challenging times, mainly due to factors which were set in train long before the brexit vote. However, the shipping industry is used to market cycles and draws resilience from the fact that global trade cannot function without international shipping. Regional issues like the Brexit vote certainly have the power to impact the market, but if ultimately they are not significant enough to affect global supply and demand for physical goods and commodities, they are unlikely to prove more than a drop in the ocean in terms of their individual impact on the global shipping market.
The impact of the vote is bound to be felt more locally, in the UK and European shipping industry. Particular markets, such as the UK offshore market and the UK marine professional services market, will be watching the negotiations unfold very carefully in order to evaluate both the issues and also the opportunities that brexit creates for them depending on the future structure of relations both between the UK and the EU and the UK and the rest of the world.
Source: Eversheds International | Hellenic Shipping News
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Thursday, 28 July 16
LAST WEEK ENDING UP WITH BUSIER TONES FOR SUPRAMAXES NOW COOLING DOWN - FEARNLEYS
Supramax
Last week ending up with busier tones for Supramaxes now cooling down as with index being down to 684. Average daily earnings for Supram ...
Wednesday, 27 July 16
RATES FOR THE SMALLER SIZES OVER-PERFORMED THE MARKET LAST WEEK - INTERMODAL
The decline the BDI noted last week was somewhat expected given the fact that the market has been overall firming for almost a month no ...
Wednesday, 27 July 16
GLOBAL OIL SUPPLY IS EXPECTED TO REMAIN HIGHER THAN GLOBAL CONSUMPTION IN 2016 - CHRISTOPHER WHITTY
Global oil supply is expected to remain higher than global consumption in 2016, keeping oil prices at relatively low levels this summer compared wi ...
Tuesday, 26 July 16
NORTH P&I CLUB EXPLAINS HOW TO AVOID CLAIMS FOR SELF-COOKING SOYA BEANS
KNOWLEDGE TO ELEVATE
North P&I Club has advised its members to be extra vigilant during loading and transport of soya beans to ensure they ...
Monday, 25 July 16
STRONG BUYER DEMAND PUSHING UP INDONESIAN THERMAL COAL INDICES
COALspot.com: Average 5000 GAR coal index of Indonesian origin rose 0.73 percent week over week to averaging $40.83 per ton this past week, shows C ...
|
|
|
Showing 2346 to 2350 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- PetroVietnam Power Coal Import and Supply Company
- Therma Luzon, Inc, Philippines
- Binh Thuan Hamico - Vietnam
- White Energy Company Limited
- Banpu Public Company Limited - Thailand
- Parry Sugars Refinery, India
- CIMB Investment Bank - Malaysia
- Ministry of Transport, Egypt
- Asmin Koalindo Tuhup - Indonesia
- Sojitz Corporation - Japan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jindal Steel & Power Ltd - India
- Global Business Power Corporation, Philippines
- Coalindo Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Star Paper Mills Limited - India
- Gujarat Electricity Regulatory Commission - India
- Karaikal Port Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Uttam Galva Steels Limited - India
- Eastern Coal Council - USA
- Indonesian Coal Mining Association
- European Bulk Services B.V. - Netherlands
- The State Trading Corporation of India Ltd
- Singapore Mercantile Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Africa Commodities Group - South Africa
- Central Electricity Authority - India
- Economic Council, Georgia
- Trasteel International SA, Italy
- Madhucon Powers Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Posco Energy - South Korea
- Coastal Gujarat Power Limited - India
- Merrill Lynch Commodities Europe
- Romanian Commodities Exchange
- Xindia Steels Limited - India
- Eastern Energy - Thailand
- PowerSource Philippines DevCo
- Bhoruka Overseas - Indonesia
- TeaM Sual Corporation - Philippines
- Baramulti Group, Indonesia
- SMG Consultants - Indonesia
- Kaltim Prima Coal - Indonesia
- Electricity Generating Authority of Thailand
- Sarangani Energy Corporation, Philippines
- Thai Mozambique Logistica
- Kepco SPC Power Corporation, Philippines
- Marubeni Corporation - India
- Indian Oil Corporation Limited
- Global Coal Blending Company Limited - Australia
- GAC Shipping (India) Pvt Ltd
- GN Power Mariveles Coal Plant, Philippines
- Metalloyd Limited - United Kingdom
- Carbofer General Trading SA - India
- Kideco Jaya Agung - Indonesia
- ASAPP Information Group - India
- SN Aboitiz Power Inc, Philippines
- Rio Tinto Coal - Australia
- Anglo American - United Kingdom
- Commonwealth Bank - Australia
- Georgia Ports Authority, United States
- Sree Jayajothi Cements Limited - India
- Independent Power Producers Association of India
- Aboitiz Power Corporation - Philippines
- Electricity Authority, New Zealand
- Antam Resourcindo - Indonesia
- Orica Mining Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Cement Manufacturers Association - India
- Altura Mining Limited, Indonesia
- Global Green Power PLC Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Sical Logistics Limited - India
- Salva Resources Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Riau Bara Harum - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Meenaskhi Energy Private Limited - India
- Kohat Cement Company Ltd. - Pakistan
- IHS Mccloskey Coal Group - USA
- Rashtriya Ispat Nigam Limited - India
- SMC Global Power, Philippines
- Semirara Mining and Power Corporation, Philippines
- Medco Energi Mining Internasional
- Directorate General of MIneral and Coal - Indonesia
- Mintek Dendrill Indonesia
- Sakthi Sugars Limited - India
- GMR Energy Limited - India
- Central Java Power - Indonesia
- Mercator Lines Limited - India
- The University of Queensland
- India Bulls Power Limited - India
- Latin American Coal - Colombia
- Malabar Cements Ltd - India
- Toyota Tsusho Corporation, Japan
- Wood Mackenzie - Singapore
- Australian Commodity Traders Exchange
- Straits Asia Resources Limited - Singapore
- Coal and Oil Company - UAE
- Chettinad Cement Corporation Ltd - India
- Makarim & Taira - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Goldman Sachs - Singapore
- Cigading International Bulk Terminal - Indonesia
- Borneo Indobara - Indonesia
- Orica Australia Pty. Ltd.
- Billiton Holdings Pty Ltd - Australia
- Sinarmas Energy and Mining - Indonesia
- Mjunction Services Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Bulk Trading Sa - Switzerland
- Kumho Petrochemical, South Korea
- Timah Investasi Mineral - Indoneisa
- CNBM International Corporation - China
- Kapuas Tunggal Persada - Indonesia
- Vizag Seaport Private Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Bharathi Cement Corporation - India
- Australian Coal Association
- Edison Trading Spa - Italy
- Essar Steel Hazira Ltd - India
- Bayan Resources Tbk. - Indonesia
- Intertek Mineral Services - Indonesia
- Aditya Birla Group - India
- PTC India Limited - India
- Grasim Industreis Ltd - India
- Parliament of New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhushan Steel Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Leighton Contractors Pty Ltd - Australia
- Vedanta Resources Plc - India
- Manunggal Multi Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- International Coal Ventures Pvt Ltd - India
- Wilmar Investment Holdings
- Simpson Spence & Young - Indonesia
- Petron Corporation, Philippines
- Standard Chartered Bank - UAE
- South Luzon Thermal Energy Corporation
- Ambuja Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Lanco Infratech Ltd - India
- Semirara Mining Corp, Philippines
- Tamil Nadu electricity Board
- Siam City Cement - Thailand
- Globalindo Alam Lestari - Indonesia
- Power Finance Corporation Ltd., India
- Tata Chemicals Ltd - India
- IEA Clean Coal Centre - UK
- Meralco Power Generation, Philippines
- London Commodity Brokers - England
- TNB Fuel Sdn Bhd - Malaysia
- ICICI Bank Limited - India
- Iligan Light & Power Inc, Philippines
- Barasentosa Lestari - Indonesia
- Bukit Makmur.PT - Indonesia
- McConnell Dowell - Australia
- Formosa Plastics Group - Taiwan
- Gujarat Sidhee Cement - India
- Larsen & Toubro Limited - India
- Interocean Group of Companies - India
- Videocon Industries ltd - India
- Bhatia International Limited - India
- Ministry of Finance - Indonesia
- LBH Netherlands Bv - Netherlands
- Bukit Baiduri Energy - Indonesia
- New Zealand Coal & Carbon
- Energy Development Corp, Philippines
- Kobexindo Tractors - Indoneisa
- Bukit Asam (Persero) Tbk - Indonesia
- Indogreen Group - Indonesia
- Agrawal Coal Company - India
- Vijayanagar Sugar Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Port Waratah Coal Services - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Chamber of Mines of South Africa
- Renaissance Capital - South Africa
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Mines - Canada
- Dalmia Cement Bharat India
- Sindya Power Generating Company Private Ltd
- Indika Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- The Treasury - Australian Government
- Samtan Co., Ltd - South Korea
- Kartika Selabumi Mining - Indonesia
- Krishnapatnam Port Company Ltd. - India
- MS Steel International - UAE
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Siam City Cement PLC, Thailand
- GVK Power & Infra Limited - India
- Pendopo Energi Batubara - Indonesia
- Mercuria Energy - Indonesia
- Minerals Council of Australia
- Heidelberg Cement - Germany
- Bangladesh Power Developement Board
- Ind-Barath Power Infra Limited - India
- Oldendorff Carriers - Singapore
- Attock Cement Pakistan Limited
- Indian Energy Exchange, India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- VISA Power Limited - India
- Energy Link Ltd, New Zealand
- Thiess Contractors Indonesia
- Ceylon Electricity Board - Sri Lanka
- Indo Tambangraya Megah - Indonesia
- San Jose City I Power Corp, Philippines
- Planning Commission, India
- Price Waterhouse Coopers - Russia
|
| |
| |
|
