From the News Desk: Sailing in red ink as trade tensions escalate
Our regular round-up of the stories behind the headlines and a timely call to celebrate the innovators, the visionaries and the success stories in shipping
This week: More bad news for shipping as Trump’s tariff tiff with China steps up a gear, earnings season reveals shipowners sailing in a sea of mostly red ink, and the Iran-UK conflict in the Strait of Hormuz continues to cause concern for shipping
The Trump trade war with China escalated this week, with 10% tariffs on $300bn of imports signalling massive consequences for container lines, US consumers, and port authorities too. One port head lamented a $25m tax on $100m in cranes arriving next year. We’ve covered the story from both sides of the world here and here.
Such is the impact this trade war is having on container trade flows that our just-released Lloyd’s List Top 100 Container Ports may well be out of date sooner than expected. Anything and everything you need to know is here.
Sanguine about the second quarter
Earnings season provides rare visibility into shipowner and operator profitability and listed companies this week — including Precious Shipping, GasLog, Teekay Tankers, Capital Product Partners, Navios Partners, ONE, Diana Shipping, Eagle Bulk and the Japanese trio of Nippon Yusen Kaisha, Mitsui OSK Lines and Kawasaki Kisen Kaisha — have been painting lipstick on a pig of a second quarter. Shipowners of gas carriers, bulk carriers, containerships and tankers all made the best of a poor slate of results. By now, most had been anticipating some form of IMO 2020-related spike in rates — either because of the removal of ships from trading for scrubber installations, or increased demand for shipping the new residual fuel blends to places of need. The overall takeaway is that this has yet to come. Stayed tuned.
The crew of the Stena Impero and Grace 1 are no closer to being released after a week that yielded little diplomatic progress but some colour on how shipping is adapting to the greater risks of transit through the Strait of Hormuz. “It’s pretty intense out there,” says the commanding officer of the Royal Navy frigate that’s spent the past month there, with 85 “interactions” with Iranians on the water.
Meanwhile, insurance rates have spiked, and chances of a standalone European-led military patrol to escort merchant shipping are diminishing. Instead, talks this week signalled the likelihood of the UK, as well as other European and Asia countries joining forces with the US.
You can catch up on all of the latest news and analysis via our special Strait of Hormuz page here, but you can also listen to our latest thinking on the topic by tuning into this week’s Lloyd’s List Podcast.
And don’t forget, you can now subscribe to the Lloyd’s List Podcast via iTunes and Spotify, as well as most other podcast providers. And make sure you are registered for a free account on Lloydslist.com so you can receive our Daily Briefing e-mail
The underbelly of shipping was revealed this week in the form of a particularly worrying accident investigation report. The specifics are compelling — it is now clear that unpaid bills and lack of adequate insurance cover led to the grounding of the Russian bulker Kuzma Minin off Cornwall in December last year. But we are now looking more widely at the issue and asking how many other accidents are happening directly as a result of financial neglect from owners against the wall when it comes to paying the bills. Our initial investigations suggest you will be reading about this in next week’s edition.
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Tough conditions come as standard in shipping right now, but some companies are still managing to shine through innovative thinking, skill and determination.
We’ve said it before, but the Lloyd’s List Awards are more necessary than ever, precisely because they reward successful endeavour in the face of seemingly intractable problems.
So we urge you to wear your laurels with pride. Modesty is falsely applied in a world casting about for answers to tough questions. If you’re proud of an achievement, shed light on it and show your customers what you’re made of.
You can enter all of the Lloyd’s List Global Awards here. They are free to enter and the process is quick and simple, but deadlines are looming so speed is of the essence.
As ever, the awards will be independently judged by a leading panel of experts from across the shipping industry who will assess entries on merit and judge without fear or favour to anyone.
Let’s celebrate the innovators, the visionaries and the success stories in shipping. Get your entry in now — you have to be in it to win it!