Dry Bulk Update

Good morning,

Dry Bulk Update:

The numbers out of London this morning have all four-component indices of the BDI in the green. Once again the market momentum is being fueled by the Cape class driving the BDI up by just under 4%. Looking closer at the Cape routes the major influence was on C 16 (180mt revised backhaul) gaining over 30% overnight. The BCI itself is up settling at a tad under 2400. The Panasisters are catching the Cape wake and firming the BPI to the 700 mark.

BCI 5 T/C ~$15,300

BCI 4 T/C ~$14,500

BPI 4 T/C ~$5,600

BSI T/C ~$6,975

BHSIT/C ~$6,075

Dry FFA:

We see in the FIS report the Capes were up early but some profit taking post index leaves the Cape curve down for the day. Panasisters and Soups are firming on mostly deferred.

Q4-16

Capes $9,900 -450

Pmax $7,000 +200

Soups $7,450 +200

From our man Erik Stavseth at Arctic Securities talks Chinese coal…”Dry Bulk: Cape rates continue to fly high, but Chinese policy intervention is back in town set to contain coal’s price surge – Slowing Chinese mining activity combined with strong steel output has boosted demand for what was labeled a dying commodity, leading coal prices to surge in the past months. Chinese authorities have taken big-boy decisions to curb domestic coal output, with reported cuts of 180-200m tons already, and sending coal output down 10.2% (Y-o-Y) between January and August to 2.18b tons. However, complaints about the price surge from consumers such as power plants and steelmakers have caused the Chinese government to intervene to stabilize prices. Fourteen coal mines owned by Shenhua Group (China’s biggest coal producer) may raise coal output by as much as 2.79m tons this month.”

$CPLP Capital Product Partners

$CPLP Capital Product Partners

2016-09-20 12:37 PM

A small push downwards from the previous comfort range has created a little concern for maintaining CPLP’s price, but the possibility remains of some recovery to the 3.50 region.
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Previous comments on CPLP:

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2016-09-12 10:41 AM

CPLP Capital Product Part
As expected, CPLP has hung around in the general zone of 3.50 -3.75 range as previously mentioned.
It remains to be seen how the recent weakness in medium-range tanker rates maintains this range.

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2016-07-22 3:06 PM

CPLP Capital Product Part
At last time of writing (Jun 15), $CPLP
announced charter rate reductions on several vessels
as part of the Hyundai (HMM) restructuring.
The effect has been profound, of course and we may see a heavier consolidation of support in the
3.15 – 3.25 area. Any further upward motion, say 4.00 or more, could see that support pegging around 3.50 – 3.75

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2016-07-15 10:10 PM
CPLP Capital Product Part
Observations remained unchanged as CPLP ground its way up to the 3.15 area this past week.
This is a pretty tight range to be offering opinions on, but at least some confirmation of previous
ideas was seen.

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2016-07-09 11:21 AM
CPLP Capital Product Part
It would appear CPLP is building some support around the 2.80 mark, but previous rests and/or pullbacks have not borne out any reason for longer-term bullish thinkers, reflecting the market as a whole, of course. However, the climb to the 3.00 region around June could give some staying power at that price.

We hold no interest or position in CPLP

Dry Bulk Ag Update

The Weekly Ag Update:

From our friends at USDA

“For the week ending September 8, total inspections of grain (corn, wheat, soybeans) for export from all major export regions reached 3.1 million metric tons (mmt), down 10 percent from the previous week, up 72 percent from last year, and 96 percent above the 3-year average. Grain inspections are up16 percent year to date, and are up 88 percent from last year during the last 4 weeks.

For the week ending September 8, 48 ocean-going grain vessels were loaded in the Gulf, 20 percent more than the same period last year. Sixty-three vessels are expected to be loaded within the next 10 days, 19 percent more than the same period last year. For the week ending September 8, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $30.50 per metric ton, 2 percent more than the previous week. The cost of shipping from the PNW to Japan was $16.50 per metric ton, unchanged from the previous week.

As of September 10, total calendar year-to-date grain barge tonnages on the locking portion of the Mississippi River system have reached 28.6 million tons, 23 percent higher than last year and 43 percent higher than the 5-year average for the comparable period.

On average, about 55 percent of the annual barge tonnages on the locking portion of the river system are corn, 7 percent are wheat, 37 percent are soybeans, and a small amount of other grains. During a typical fourth quarter (October to December), soybeans become the predominate commodity shipped, representing 56 percent of the quarterly locking tonnages. With expectations of record soybean exports, there will likely be continued growth in barged soybean tonnages for the first half of the new crop year.”

Wet Bulk Update

Wet Bulk:

We hear from our friends at Clarkson’s the VLCC fixture activity is slow and rates are sliding accordingly on the AG>East routes to WS 34 (~$13,700 per day). On a brighter note, the Suezmax routes are climbing on average to around $30,000. To provide a bit of contrast, last year at this time VLCC rates were $72,300 and Suezmax rates averaging just over $56,000.

The MR’s running US Gulf > Europe saw rates jump over 16% today.

LNG 160 & 140 remain unchanged.

Dry Bulk Update

Good Morning Superior Maritime.

Dry Bulk:

Looking at the numbers out of London this morning the Capes continue to climb. The BCI 5TC jumped over 9% with routes C8 14 up almost 19% and C 16 up just over 13%. The BDI has now risen above 900 gaining over 4% on the day. Some of the larger brokerage desks express strong sentiment in the Cape space citing a potential increase in miner output that should tighten available tonnage. Our friends at Arctic Securities suggest the recent uptick in Capes has put a floor on asset prices that will further confound owners struggling with the scrapping decision.

Average of the 4 T/C routes is around $13,300 per day.

Average of the 5 T/C routes is around $14,350

BPI T/C routes are averaging just under $5,400

BSI T/C routes are averaging just over $6,900

BHSI T/C routes are averaging around $6,000

Dry Bulk Futures:

Our good friends at FIS tell us the paper market (FFA’s) is firmer, led by the Capes while expecting the Panamax curve to trade up modestly, and the Supra/Handy to be flat to moderately up. CAL17 futures are now trading at $7,600 for the Capes after gaining 2.3% today.

All in all, a welcome spike for the big ladies in an otherwise flat/weak dry bulk market.

$SFL – Ship Finance International

Ship Finance International SFL
2016-09-20 4:35 PM

Our last comments on SFL (Jul 15th) were optimistic for 14.75 – 15.50, and that price area was reached by mid to late August. Since then, we’ve seen some shenanigans that may be calming down a little. 15.25 or thereabouts may be a decent target, but recent weakness will force us to monitor the 14.25 area for downward slides.

Previous ramblings on $SFL:

Ship Finance International – SFL
2016-07-15 10:34 PM
Still a little bullish optimism here, with SFL price around our previous target area of 14.75 – 15.50. Raising possible support to the 14.50 region may be a bit premature.

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Ship Finance International – SFL

2016-07-09 2:07 PM
Some weakness seen in SFL lately, after all those bullish calls back in May. 14.75 to 15.50 could be seen as a continuation of bullishness, and the weakness seen doesn’t appear to give pause for any major downward retracements yet.
Support around the 14.00 mark may prove to be a blessing.

$CPLP Capital Product Partners

As I work up more tech analyses, my commentaries will be more coherent. For the moment, here’s a short timeline of my recent thoughts on $CPLP.

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2016-09-12 10:41 AM CPLP

As expected, CPLP has hung around in the general zone of 3.50 -3.75 range as previously mentioned.
It remains to be seen how the recent weakness in medium-range tanker rates maintains this range.

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2016-07-22 3:06 PM CPLP

At last time of writing (Jun 15), $CPLP announced charter rate reductions on several vessels
as part of the Hyundai (HMM) restructuring. The effect has been profound, of course and we may see a heavier consolidation of support in the 3.15 – 3.25 area. Any further upward motion, say 4.00 or more, could see that support pegging around 3.50 – 3.75.

———————————-

2016-07-15 10:10 PM CPLP

Observations remained unchanged as CPLP ground its way up to the 3.15 area this past week. This is a pretty tight range to be offering opinions on, but at least some confirmation of previous ideas was seen.

———————————-

2016-07-09 11:21 AM CPLP

It would appear CPLP is building some support around the 2.80 mark, but previous rests and/or pullbacks have not borne out any reason for longer-term bullish thinking, reflecting the market as a whole, of course. However, the climb to the 3.00 region around June could give some staying power at that price.

Artificiality of Intelligence?

Dennis Bryant’s excellent article “Artificial Stupidity” certainly sets off the alarm-clock when it comes to that sleeping elephant in the room: un-manned merchant vessels. In today’s seas of technology, also designed to swamp you with hype, he states what’s in the back of everyone’s mind: “……when will the first unmanned cargo ship spectacularly fail?”

Artist’s impressions of sleek, swift, bridge-less ships slicing through all manner of weather are powerful images. In virtual-reality monitoring centers ashore, the usual is seen; impossibly good-looking crew surrounded by heads-up displays, with every twitch of a finger fine-tuning the efficient delivery of globe-trotting freight. Not so fast………..

Yes indeed, the progress is truly amazing, the concepts within the systems unheard-of, although the idea of sentient machines has been with us for many years. What’s the catch? Let’s consult the pantheon of sci-fi short stories out there – there must be something we can seize on to illustrate a point.

Back when rocket-ships had chrome-plated nosecones and fins, and they were flying us off to Mars every month, there wrote an author by the name of Fritz Leiber. Leiber elaborated on the chess-playing machine built by Baron von Kempelen in the 1700s, later taken on tour by Johann Maelzel in the 19th century. This marvelous machine was famously exposed as having a man inside by none other than Edgar Allan Poe. Now, one of Leiber’s artificial intelligence stories was “Appointment In Tomorrow”, in which a massive supercomputer named Maizie answers questions fed to it from the world’s intelligentsia. Inside the huge metallic casing, unknown to all except a select few, reading the questions, “…a suave fat man in shorts sat drinking beer.”

Where was I? Right; shipping. We will see a lot of promotion and presentations; a great deal of which, when it comes to levels of artificial intelligence, will be actual fact. However, until we humans are fully satisfied with their seemingly sentient operation, somewhere there will still be people inside the machine, trouble-shooting, de-bugging and smoothing over the gaps in its…..um….intelligence. There will be failures, both human and non-human. Still, shipping classification societies and insurers will be extremely cautious approving autonomous control, while in the midst of debates over catastrophic wreck and salvage costs. Even after all that, as with Maelzel’s chess-playing automaton, we may still have a hand in the machine. As Maizie the supercomputer – sorry; the “suave fat man in shorts” – was asked in Fritz Leiber’s story, “Does Maizie stand for Maelzel?”

Posted on tonmiletrader.com , AUG. 26, 2016