Shipping Markets

See that markets are at low levels but remain firmer.

Ship Scrapping at record levels and new orders are virtually non existent.

I remember at the height of the market we saw a plethora (yes i know a few big words) of new shipbuilding yards arise from no where, and my feeling is we will see many disappear at the same speed.

Also interesting to see that capital markets are still tight and much more private money seems to be circulating for shipping investments. The current state of play in Europe is not helping this climate and should the Greeks do a runner....then who knows what will happen. Most of the contingencies have already been factored into markets but until IT actually happens no one knows for sure where this mess will leed.

Maybe 'short term pain" for "long term gain" is something we all need to get used too..


Also see a new report saying the strongest growing economies over the next few years promise to be Mexico, Chile and Australia. So in every bad market...there are always a few that buck the trend.

cheers
vs

The role of a shipbroker

An open question to the experienced shipping fraternity out there...

What is the role of a broker? Sounds like a simple question doesn't it....so let me flesh out the scenario a little.

It seems to me that due to the improvement and ease of communication, over the years, and also due to the boom market of the 'naughties' the ship chartering markets have morphed into 'one broker' markets.

20 years ago most deals contained 2 brokers - each representing (taking) a side.

So these changes, so it seems to me anyway, has made the role of brokers into facilitators and mediators - looking to keep both parties happy and somehow steering both towards a mutually beneficial agreement.

I wonder if this is the way the system is supposed to work? In many other commodity trades 'each principal' MUST have its own broker....the reason being is simply because negotiation SHOULD be adversarial...it should be a fight where brokers know who they are representing (no conflict of interest), and then in the wash up....a deal is reached.

Think of it a bit like the law, or a democratic parliament....both sides using everything they can to win!

As it stands, many brokers, in many deals are swinging in the wind, more politician than prize fighter...

I make a call out there to the shipowners and charterers who refuse to have more than one broker involved in any deal....

Who is your broker working for? You OR the other party?
Are you sure this is not 'false economies'?

Having worked as both principal and broker over many years I have seen how easily a broker can influence a negotiation....and i can tell you that when i negotiate these days, whether its a chartering deal, buying a house, buying insurance, trading equities, I always make it a priority to know who is on my side!

Discuss

The Virtual Shipbroker

Ship chartering corruption makes headlines

An example of alleged corruption in our industry. This is not the first or the last time you will here of this kind of behaviour....unfortunately if one were to dig a little similar types of relationships would pop up quite regularly me thinks!

Having said that must point out these are only allegations and this was reported in the news over the last week or so.

Quote

Oil giant BP has suspended a senior executive alleged to have taken cash payments in return for awarding multi-million pound contracts to a shipping company, the Daily Telegraph reported on Monday.Related News & Articles


OIL giant BP has reportedly put its global chartering manager Lars Dencker Nielsen on leave of absence as it investigates claims made by a whistleblower earlier this year that a senior manager offered favourable freight rates to a shipowner in return for cash.

BP Plc (BP/) said it’s investigating charges of bribery and corruption in a unit that charters oil tankers. The newspaper added: “The Danish national is alleged to have offered favourable terms to one of BP's shipping suppliers for cash. The allegations, under investigation, were brought to light by a whistleblower describing himself only as a BP employee.” ENERGY goliath BP said today it is investigating actions of its global chartering manager, after media reports alleged that he had taken bribes. An anonymous informant sent a letter to Chief Executive Officer Bob Dudley and the U.K.’s Serious Fraud Office saying that tanker contracts were awarded on preferential terms in exchange for cash payments to a BP employee, the Daily Telegraph reported today. “We can confirm that the chief executive’s office did receive a letter,” BP spokeswoman Sheila Williams said. “BP conducts its business to the highest ethical standards. We take all allegations of this sort extremely seriously and always investigate them.”


The allegations add to BP’s legal problems after the company this month agreed to a $7.8 billion payout to victims of the 2010 oil spill in the Gulf of Mexico, the worst in U.S. history. BP Shipping Ltd., the world’s second-largest charterer of tankers, said on Aug. 16 it lost $143.6 million in 2010 because of “challenging market conditions” and lower hire costs for tankers.

BP is the world’s third-largest hirer of tankers that carry crude oil after Royal Dutch Shell Plc (RDSA) and China International United Petroleum & Chemical Co., according to Poten & Partners, a New York-based shipbroker and maritime consultancy. The company’s shipping division chartered 422 crude oil tankers for single voyages in 2011, or 5 percent of all tankers reported as hired to the market.

Unquote

Interesting stuff..

If anyone else want to be a whistle blower - send me an email and ill sell the story to Murdoch...

Thats a joke off course


++

A happy student


Just in from a current student of my VS chartering and shipbroking certificate

quote

Having read numerous articles on the net , the ICS books as well as other so called ‘bibles ‘ like Maritime Economics by ‘the’ Martin Stopford of Clarksons, am the first to admit that the words don’t ingrain themselves the way your exercises do .

With your experience of ‘mentoring’ , you have a structured manner of introducing one topic after another which is difficult otherwise for us"..

Arun Nair - Australia

unqte

Thanks for the message Arun and yes key to the course is the structure....it flows in a way that hopefully makes sense, building on your knowledge on step at a time.


For those of you who are interested next intake will be September or October 2012


Cheers
VS

shipping expert witness

I have had quite a good response to the call for shipping experts for the VS expert witness database. Half a dozen experts and growing!

So if you are a shipping expert in any area whether that be chartering, operations, management, crewing, offshore, snp, broking, agency, containers, surveying, tankers, dry cargo, multipurpose...anything shipping related  - then get in touch with me at virtualshipbroker@yahoo.com

all geographical regios needed

And if you are a lawyer needing some expertise drop me a line..

Busy Busy Busy

I have been super busy recently...

Lots of work, lots of travel, 5 new awesome students, a house to build, and heaps of personal stuff going on...all of it good!

Some really interesting work developments. Despite a slow market quite a few new deals happening, some large some small. One thing that i am finding though is that despite the slow market the standard of some of the co brokers I am dealing with is sometimes hard to believe.

Guys with 20 years experience still not understanding some basic concepts and being sloppy with the way they go about completing deals.

Sloppiness is sometime forgiven when nothing goes wrong....but the moment something does go wrong and they inevitably do...bad work practices can come back to haunt...big time!

Good habits are important because brokers with good habits never seem to find themselves in trouble. Brokers with bad habits have a way of courting trouble.

This is nothing new in all aspect of life....

Geez im getting fired up for the olympics only 3 months away. I am one of those couch sloths who during both the world cup football and Olympic games would happily stay on a sofa 24/7 for weeks on end. All i need is a chest full of beer, some corn chips and the occasional change of clothes...

Taken last night. Vs unmasked!

And here you guys were thinking that i was a man of great sophistication....


VS

Expert witness shipbroking / shipchartering / maritime operations

One interesting part of the growing VS shipping consultancy business is the requests i have had either to be, or to provide, and expert witness for some commercial shipping disputes.

I am anonymous so a i cannot partake but I have been able to help out a small handful of lawyers by pointing them in the right direction.

So here is a bit of a call to the bulk shipping experts out there...

If you have excellent deap sea / commerical knowledge and fancy yourself as an expert in your field then drop me a line and i will put you on my database and you never know you might get some work.

So if you are a shipbroking, chartering, operational expert just about anywhere in the world send and email to virtualshipbroker@yahoo.com

Dry Cargo, Tankers, Off Shore, SNP, Derivatives ....backgrounds all wlecome to register..

Not only must you be a proven expert but your honesty and integirty should be without question...

Oh...and if you are a maritime lawyer in need of an expert you know your first port of call...Right Here!

Cheers
The Virtual Shipbroker

Laden legs or short period

Ok a interactive question for the readers..

One of my students is trying to get his head around the following problem

A charterer is asking the market for a ship basis 2 or 3 laden legs

the question is

Why does a charterer ask for 2/3 laden legs and why not just ask for short period?

I have a feeling that i am gonna have to explain this more....but please if you know the anser have a go!

When less is more

Had a meeting recently where as a third party i was able to sit back and watch the courting process from a fairly unbiased position.

Unfortunately for one of my principals, during the course of the informal meeting, it became apparent that, how can i say this tactfully.......i can't. Basically he just couldn't (or wouldn't) SHUT UP!

In an effort to push his business he forgot to listen to the client.

I have a general rule. If i go to a meeting and I have talked more than the client then i know its been a failure. A failure for many reasons...

1. Clients like to be heard and they, like most people like the sound of their own voices. If they are the client then that is their right!

2. If I have talked too much the chances are that in my excitement I have actually "failed to listen". Terrible outcome when as a service provider I am trying to understand the clients problems. And clients don't always TALK verbally....they communicate by the way they stay silent, move their hands, move their eyes, and by the way they sit...

For me I try to look out for all those clues. And in truth this is a skill that has helped me read situations that others fail to understand.

3. Generally if I talk too much I say the wrong thing! Eventually anyway..

So whats the moral here...

ITS NOT ABOUT ME (AND YOU)!!!! (its about the client)

Cheers
VS