Supply dynamics in the dry cargo market are set fair to support a recovery if demand holds together, CMB chief executive Alexander Saverys believes.
The shipowner says he and his peers have enjoyed December and want to enjoy the next couple of years as well, despite the inevitability of overbuilding in the future.
“There are certain things we know and there are certain things we don’t know,” Saverys told the Nordea Markets forum in London today.
“I’m a shipowner. I have an idea of what is coming in terms of supply – but I have to be honest, I don’t know what is coming in terms of demand.
“I read the same articles you do and listen to the same analysts. If demand performs moderately well, we know the supply side is going to support the story.
“We can be prudent, we can be optimistic, we can be pessimistic, but in terms of dry bulk the sky could well be much brighter than what we think today.”
Saverys notes that shipowners have a habit of preaching a no newbuilding script while quietly inking two, option two newbuilding contracts – something he quickly stresses CMB has not done.
“If you can’t stand over ordering, leave shipping,” he said.
“It’s something we do as an industry. Everybody knows if you go to yards today the next 18 months are full and we can confidently say the supply we can see for the next two years is the supply we are going to get.”
The executive was also pragmatic about the merits of consolidation in the highly fragmented dry bulk market.
“There is a push from certain companies to create larger platforms,” he said.
“But let’s face it, even with 150 capes today you will never be a price marker in this market.
“The reason for having a larger platform is you can probably do larger deals with some of the very large customers on the mining side. But you will never be able to control the market and put the price where you want it.”
