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Daily Briefing

January 5, 2018

 

Daily Briefing January 5 2018

Stock performance survey shows investors bet on a dry cargo market recovery in 2017, but were less sanguine about the tanker sector

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Dry cargo tops 2017 stock performance survey

DRY bulk companies were among the best-performing shipping stocks in 2017, according to a survey of US-listed companies by Lloyd's List.
 
While six dry cargo companies made the top 10, there was a broad sell-off of tanker stocks reflecting the continuing negative effect of cuts by the Organisation of the Petroleum Exporting Countries on crude oil trade and demand for oil transportation. This helped to lead to six tanker companies in the bottom 10.
 
Investors at the two major US exchanges, the New York Stock Exchange and NASDAQ, bid dry bulk stocks up in anticipation of a market recovery in 2018.
 
The survey ranked US-listed companies based on each stock's total return. As in years past, we included the cash value of dividends to the year-on-year stock price change.
 
The best-performing stock was Safe Bulkers, with a total return of 181%. 
 
Fellow dry bulk companies Star Bulk and Genco Shipping & Trading claimed the next two spots, with total returns of 120% and 80%, respectively. Other dry bulk stocks to make the top list were Golden Ocean, Scorpio Bulkers and Diana Shipping.
 
The sole tanker company to make the top list was Gener8, which saw its stock price getting a boost at the end of the year, the result of an agreement to be bought by Euronav. Gener8 posted a total return of 48% for the year.
 
Two master limited partnerships, Navios Maritime Partners and Teekay LNG Partners, and GasLog rounded up the list of the best-performing stocks.
 
Turning to the bottom of the list, Nordic American Tankers posted the worst stock performance, with a total return of -64%.

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Top stories:

Taiwan probes Lighthouse Winmore charterer

THE businessman alleged to be connected to a ship-to-ship oil trade with North Korea has been charged by local prosecutors with providing false information in export documents.
 
Chen Shih-Hsien, who runs a Taiwan-based fishing company, put Hong Kong as the destination in an export declaration form while knowing the vessel hired was to sell oil in international waters, according to a statement by Kaohsiung District Prosecutors Office.

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Palau registry says UN-blacklisted ship was under 'previous flag'

PALAU International Ship Registry says reports that a tanker blacklisted by the UN for trading with North Korea was flying its flag are "totally untrue".
 
The vessel, previously registered in Panama, only provisionally became part of the PISR fleet on December 8 when it was in Taiwan and renamed as Kingsway, the registry said in a statement on Wednesday.

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Seaspan secures $250m loan commitment from Fairfax

FAIRFAX Financial Holdings, a Toronto-listed property and casualty insurance and reinsurance company, has signed a letter of intent to invest $250m in Seaspan, and potentially increase its investment to $500m over the next seven years.
 
Fairfax will lend Seaspan $250m in the form of seven-year unsecured notes that carry a fixed interest rate of 5.5%. The interest rate is low compared with the 10-year, 7.125% baby bonds that Seaspan issued in October 2017.

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Opinion:

The future is never perfect

IT IS so very interesting to read all the forecasts for the coming year, which some regard as a seasonal affliction, like a surfeit of mince pies, but provide much food for thought, writes Michael Grey.
 
We should be grateful to the respective seers who have contributed so many hours of earnest research to reinforce their prognostications. I gave up trying to say anything sensible about the future years ago, because it just never seemed to work out

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Markets

Secondhand shipping markets expand by 47% to $32bn in 2017

SECONDHAND markets for cargo carriers and offshore vessels both saw significant increases in the number of sales and transaction amounts in 2017, driven by stronger activity in nearly all sectors.
 
Total money spent in secondhand deals amounted to $31.5bn in 1,709 deals last year, compared with $21.4bn in 1,544 deals in 2016, according to VesselsValue estimates.

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Full-fledged shipping recovery still in the making, says MOL chief

TOKYO-based Mitsui OSK Lines president and chief executive Junichiro Ikeda said trading conditions remained mixed across businesses in the shipping industry and that a full-scale recovery was still in the making.
 
Although 2017 was a year of resurgent growth in global trade, supported by a firm world economy, the operating environment surrounding the MOL Group became increasingly unstable owing to factors such as the North Korea situation, he said.

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In brief

Cofco's Argentina grains terminal remains shut after silo blast

A GRAINS terminal operated by China National Cereals, Oils and Foodstuffs at the port of Rosario, in Argentina, remains shut following an explosion that killed two workers.

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Korea to encourage shipowners to order more LNG-fuelled vessels

SOUTH Korea plans to encourage domestic shipowners to order more liquefied natural gas-fuelled vessels to help revive the ailing shipbuilding industry.

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India revamps public-private partnership pacts for major ports

PRIME minister Narendra Modi's union cabinet has approved the revised model concession agreement for public-private partnership projects at major ports.

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US court approves Toisa bankruptcy settlement deal with HHI

TOISA, a holding company controlled by Greek shipping magnate Gregory Callimanopulos, has received approval from a US bankruptcy court to proceed with a settlement agreement with South Korea's Hyundai Heavy Industries.

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Top Ships extends time charters with Stena Bulk

MEDIUM range tankers owner Top Ships has agreed to lengthen time charter agreements for four MR2 chemical/product tankers that it had inked with Stena Bulk previously.

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Positive trade flows lead to optimism on global economy

WHILE NYK president Tadaaki Naito said he expects global trade growth to be mainly focused in Asia and that the company needs to build a strong longer-term earnings foundation, K Line head Eizo Murakami says all key regions are seeing accelerating economic growth or are in recovery.

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