Malaysia hunts for pirates after tanker hijacking

Kuala Lumpur: Malaysia is hunting for a group of pirates who hijacked a tanker off its eastern coast and robbed 100,000 metric tonnes of petroleum on board. "We have activated 24-hour sea patrols around Bintulu waters to prevent similar attacks," said Mohamad Sufi Mohamad Ramli, a local commander with the Malaysian Maritime Enforcement Agency.

Mermaid bags services contract worth $19m

Mermaid bags services contract worth $19mSingapore: Mermaid Maritime Public Company announced that its subsidiary Mermaid Offshore Services has been awarded a call off contract for subsea remotely operated vehicle (ROV) services in Thailand serving major upstream oil and ga...

Epic Gas adds two more vessels to fleet

Epic Gas adds two more vessels to fleetSingapore: Epic Gas has announced that it has added two more vessels to its fleet, to take the number of vessels it controls to 44. Epic has acquired two 9,500 cbm fully-pressurised gas carriers, the 2007 built Mayfair and 2006 built...

Tanjung Priok rail link mooted

Tanjung Priok rail link mootedJakarta: State-Owned Enterprises Minister Dahlan Iskan has urged railway company PT Kereta Api Indonesia (KAI) to build a link between Tanjung Priok Port and Tanjung Priok Station.

Bumi Armada proceeds with Sukuk issuance

Bumi Armada proceeds with Sukuk issuanceKuala Lumpur: Malaysia-based international offshore oilfield services provider, Bumi Armada, announced that it, together with its wholly owned subsidiary, Bumi Armada Capital Malaysia (BACM) have entered into documentation for the es...

Archer Daniels Midland relocates Asia HQ to Singapore

Singapore: US grain giant Archer Daniels Midland is changing its operations in Asia in a big way. “As populations and incomes across Asia continue to rise, diets are evolving. With that shift comes an increase in demand for crop...

APL wins inaugural US Coast Guard security award

Washington DC: Singapore’s APL, the containerline of the NOL Group, has won the 2013-2014 Rear Admiral Richard E. Bennis Award for Excellence in Maritime Security, conferred by the United States Coast Guard (USCG).

Illingworth quits DVB for another bank posting

Singapore: Peter Illingworth, a well-known name in Singapore tanker circles, is moving on. Tomorrow he will leave DVB and go on gardening leave through to August. Illingworth holds the position of managing director of DVB Asia’s oi...

Harbor Star eyes SE Asian expansion

Manila: Harbor Star Shipping Services, a Philippine provider of harbour assistance, lighterage, salvage and towing services, is expanding overseas beginning with a bid to serve two ports in Johor, Malaysia.

Details emerge of another fuel robbery

Kuala Lumpur: A tanker travelling from Singapore to Labuan was robbed of 100,000 metric tonnes of petroleum by a crew of six pirates last Saturday, in the latest of what has become a growing scourge of fuel robberies in the region. ...

China’s SITC opens branch in Indonesia

Shanghai: SITC International Holdings has announced that its new branch in Indonesia has officially started operations. Currently the Indonesia branch is operating a CKV service which links Indonesia with China, Japan, Korea, Thai...

Latest notes issuance by Ezion

Singapore: Ezion Holdings yesterday issued S$150m fixed noted due in 2021 under its S$1.5bn multicurrency debt issuance programme. DBS Bank acted as the sole dealer in relation to the latest issuance. The notes will bear interest of 4.875% to mid-...

PSA’s Mumbai concession questioned

Mumbai: Singaporean terminal operator PSA International’s tortuous path to run a facility in Mumbai could face another hurdle. PSA has been chasing a contract to run a terminal at Jawaharlal Nehru Port for years and finally thought it had struck go...

Petronas invests $8bn for oil and gas development in Turkmenistan

Kuala Lumpur: Malaysia's Petronas has signed a memorandum of understanding with Turkmenistan on long-term cooperation on oil and gas development in the Cthis isentral Asian country. According to Malaysia’s Prime Minister Datuk Seri Najib Tun Raz...

Pelindo III takes on big crane order

Jakarta: Konecranes has signed an agreement to deliver an Automated RTG (ARTG) system to Indonesian state-owned terminal operator PT Pelabuhan Indonesia III (Pelindo III) for a terminal in Semerang in Central Java. This will be the world’s first co...

Chinpo Shipping charged over DPRK arms shipment

Singapore: Criminal charges have been filed against a Singapore-registered company implicated in a shipment of arms last year bound for North Korea, a nation that has sanctions in place. Tan Hui Tin, a Singaporean citizen, was also charged. Tan is...

SapuraKencana announces four gas discoveries offshore Malaysia

Kuala Lumpur: SapuraKencana Energy (SKE) has announced that its unit SapuraKencana Petroleum has made four significant gas discoveries in the SK408 Production Sharing Contract (PSC) area offshore Sarawak, Malaysia. All four wells have discovered n...

Details of SIBCON 2014 released

Singapore: The Maritime and Port Authority of Singapore has released details of the 18th edition of the world’s largest bunkering show. The programme for SIBCON 2014 is now available online at With a focus on cross sector d...

Thai owners call for armed ships

Bangkok: Following the Thai oil tanker MT Orapin 4 which was hijacked by pirates last month, the third attack on Thai ships since April, Thai shipowners have called for weapoms on cargo ships. Phumin Harinsut, president of the Thai Shipowners’ A...

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In Focus

The shipping recovery that never arrived

Private equity and hedge funds are gambling on ship values and not the long-term revenue streams from operations, says Paul Slater

The shipping recovery that never arrived

As we  approach the middle of 2014, shipping’s economics remain stuck in the doldrums will little or no recovery in sight.
The surplus capacity of ships to cargoes requiring transportation has been aggravated by the delivery of a massive orderbook of new ships that followed the boom markets of the middle of the last decade.

This surplus is not limited to a few markets but, with the possible exception of gas, both liquefied natural gas and liquefied petroleum gas, it has affected the rest and in particular the wet and dry bulk, and the container markets.

The effect has been severe as few ships in these markets generate a profit after operating expenses, debt interest and amortisation.

Numerous public companies have gone bankrupt, as have many private ones. The German KG funds have been almost completely wiped out and have created huge losses for the German shipping banks.

The average age of the world fleet is at a historic low, meaning the surplus will be around for at least another decade.
Unfortunately when companies go bankrupt or when their ships are arrested and sold, they do not go away but continue to trade with lower capital costs, thereby prolonging the depressed freight markets.

Furthermore, a majority of the fleets in most sectors trade in the spot markets without any period charter cover, in the false expectation that markets will recover or secondhand values will increase.

This, however, ignores the facts that shipyard capacity remains high and in countries such as South Korea and China has now become a strategic industry supported with domestic banks funding the construction period and government funds backing export credit.

All without any secure operating income from charters.

This rush to order new ships has been fuelled by an influx of new money, both equity and bonds from private equity and hedge funds that are gambling on ship v ...   More>>