Chinese bloodbath coming

Shanghai shipping institute predicts surge in bankruptcies for bulker owners this year.

Chinese bulker owners will experience a surge in bankruptcies this year, according to the Shanghai International Shipping Institute (SISI).

The consultancy said rates at record low levels and a fall in demand for imports will take their toll in 2016, Reuters reported.

SISI added that more than 60% of the dry bulk companies it analysed were loss-making, with 40% facing liquidity issues.

It spoke to 50 of the country's biggest owners.

“The market is extremely depressed and these conditions are likely to continue in 2016, exacerbating dry bulk firms’ losses, increasing costs and creating obstacles to obtaining financing. This will kick-start a wave of bankruptcies,” the state-backed company said.

Winland Ocean Shipping and shipbuilder Zhoushan Wuzhou have already filed for bankruptcy in the last year.