Dry bulk oversupply to see rebalance in next two years: Jinhui
Time：2014-12-02
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Jinhui said it expects “the rebalance on seaborne tonnages will be materialised in the next couple of years” as it remains positive with the longer term market given the long term growing import requirement from China and Asian countries.
“The recent sudden interest rate cut by China’s central bank may be another signal to the market that China intends to loosen its lending restrictions to support its slowing economic growth which may in turn benefit the dry bulk shipping market,” Jinhui commented.
The shipowner, however, cautioned that the brighter outlook would only be possible if vessel supply is in check where less or no more irrational ordering of new ships by parties with no intention of long term commitment in shipping take place.
Jinhui’s comments came on the back of its third quarter results announcement, where the Hong Kong-listed company posted a loss of $15.73m as against a profit of $24.37m in the same period of last year.
Revenue for the three months ended 30 September 2014 also fell to $27.04m compared to $52.64m a year ago.
“The drop in revenue was mainly due to the large exposure to spot freight market while freight rates kept declining with the unexpected incongruity between demand and supply of tonnages, coupled with the expiration of certain high earning charter contracts in earlier months,” Jinhui explained.
Jinhui’s fleet earned an average daily time charter equivalent (TCE) of $7,706 for the third quarter, a 42.5% drop from the $13,389 seen in the corresponding period of 2013.