Craig’s Post-Posidonia Ponderings


  • Owners are grateful to be still be in the game, but sources of finance limited.
  • Ironically, they blame cheap finance for the over-ordering.
  • Hidden stresses – the lowering of opex is breeding poor maintenance.
  • Transparency in the shipping markets is being driven by players from outside shipping (see earlier blog posts on the Orange Sofa and VesselBot seminars).
  • 125 international and Greek press and media attended Posidonia 2016 (we have obtained the list).

Seminars Attended:

  • Lloyd’s List Intelligence Briefing
  • Capital Link Shipping Forum
  • Orange Sofa
  • VesselBot

Posidonia Sentiment

The sentiment of the 2016 edition of Posidonia was one of muted celebrations by the survivors of what is turning out to be the longest shipping recession in living memory. Indeed, “survivor” may be too heroic a term given that most observers blame the owners for over-ordering new ships, and thus prolonging the recession. However, there is also a lot of anger toward the EU (i.e. Germans) and its proposal to tax Greek ship owners’ offshore earnings.

Blame Game

Ship owners blame the banks and private equity (PE) for tempting them with cheap money to order ships they didn’t really need. One owner wryly observed that PE and other new finance providers thought they could learn shipping after a few meetings. PE was treated as sheep waiting to be shorn of its money, and now PE’s expected 40% return on investment is just a dream, it is trying to exit an illiquid market. The remaining banks in shipping claim to have no money for second-string owners, but competition is intense to lend to the top tier owners. However, according to Norwegian bank DNB, deal-flow in 2016 (ytd) is down 50% on 2015. Bankers feel consolidation among the liner services and containership owners is inevitable. Despite the fragmentation of the dry bulk industry, there will be consolidation among the top tier owners, too, according to bankers.

Owner Feedback

On the owning side, there is said to be a split in the dry bulk market, consisting of those ships that are fixed (working), and those that are not. One dry bulk owner described how three years ago the required opex level for his Handies was USD 8,000/day. Today, by reducing crew from 22 to 19 people and / or putting more cadets on board (and other savings), opex has been shaved to USD 4,000/day. But there are risks, and he related how his representatives inspected a Chinese-built, 2008-built Supramax, with a view to purchase. Maintenance on the vessel had been minimal, there was rust everywhere, and she was only fit for scrap, in the representatives’ opinion.


Posidonia Quotes:

“We Greeks are happy with low returns…you need to know how to play the game… it’s about cash flow.”

“We treat ships like family members”

“What would I buy now? A seven-year old ship, every time.”

Germans know as much about shipping, as Greeks know about car manufacture!“

“Shipping is a stable industry…in that it is always unstable!”

“…the US exporting democracy ruined economies in the Middle East.”

“…shipping is not a team sport..”

“We have to look at the banking cycles. In five years’ time, there will be new faces [in the banks], and new miracles.”

“Greece is the leader in shipping in Europe. But instead of examining why and copying, the EU is trying to destroy (Greece).”

Posidonia Exhibition

According to the organisers, the Posidonia exhibition itself was visited by over 22,000 shipping industry professionals (a 15% increase on 2014). There were more than 1,800 exhibitors from 90 countries deployed across 40,000 sq. metres at the Athens Metropolitan Expo. The next Posidonia event is scheduled to be held between 4-8 June 2018.


Parties I Attended:

Friday 3 June – Lloyd’s Register Party at the Astir Palace. I flew in that evening, but the lock failed on the apartment door. By the time this was sorted out, I arrived at the party at 2.0 am – just as it ended.

Monday 6 June – Lorentzen and Stemoco Party at Club Banane on a beach near Glyfada. I was invited via Tod and Lulu (see below), two S&P brokers from Stemoco, I met at the Lloyd’s List Intelligence Briefing the day before. This was held at a beach club in the afternoon. Club Banane was not closed to civilians, who were wandering around in bikinis.

CJ and Chinese broker Zulu Zheng S&P Stemco

Lulu Zheng and Craig at the Stemoco party

Tuesday 7 June – Drinks at the TW stand. Following a sudden thunderstorm, Posidonia was deserted, and there were no guest left on the TW stand. Zero networking.

Tuesday 7 June – Korean Shipyards party at the Astir Palace. This was a formal reception, with suit and tie required. This was an open invite party and a good networking opportunity.

Wednesday 8 June – Vancouver International Maritime Centre (VIMC) party at the Vorres Museum of modern art in a village near the airport. I was invited after chatting to VIMC peeps at Posidonia Expo. This was a very difficult to get to location as the village roads were not wide enough to take E-class Merc taxis, but the hosts and location were charming. The museum holds some of the most valuable modern art in Greece, and the galleries were open during the party. Networking limited to Canadian shipping people and Greek lawyers. After the party, I shared a taxi with the Canadians to the Tradewinds party.

Christian Waldegrave (hd of research Teekay) ignores CJ selfie stick at Stemco Party

Christian Waldegrave, Head of Research at Teekay at the Stemoco Party with Craig operating the selfie stick.

Wednesday 8 June – Tradewinds party at the Island (where there appeared to be two other events on at the same time). There was a strict entry policy. The DJ was very good and the local group, The Melisses, played everything from Greek pop to Robbie Williams! The loud music made networking a little bit intimate, but by the third day of Posidonia, many of the faces were now familiar.

Thursday 9 June – Marshall Islands Party at Ble. This is a beach peninsular that is taken over by a catering company, Ble, and officially holds 2,500 people. This event was the unofficial end of Posidonia party and was packed, and included the glamour girls from the Posidonia stands. Marinakis was given an award. With several quiet areas with seats away from the music, this was a good last minute networking event.

James Leake (hd of research Arrow) and Paddy at Marshall Is Party

James Leake, Head of Research at Arrow, and Paddy Stern of VesselsValue.

Marinakis award acceptance speech at Marshall Is Party

Marinakis receives an award.

Every night – The main after-party venue appeared to be Taverna 37, which is a terrace bar in the Arion Resort Hotel (part of the same complex as the Astir Palace). This was also the main broker hang-out and frequently occupied by the likes of Richard Fulford-Smith of Affinity and Andy Case of Clarksons. Indeed, at one session, I reckoned 40% of the people on the terrace were from one or the other shop.

Greek Necessities

Posidonia: It’s not all sunbathing and drinking!


About Craig Jallal
A shipping analyst whose feels the need to comment on the industry.

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