Just When You Thought You Knew What Shipping Was……

After so long in the business, I thought I had a pretty good idea what shipping was, but it turns out I was wrong!

I have a Google alert set up for the word “shipping” appearing in the news. Of course, this occasionally throws up some non-shipping stories, but today’s shipping news link is a winner. According to the Heatstreet website “shipping” is a word used in the world of fandom to denote a romantic relationship between two characters that did not exist as part of the original story-line. While this sounds a bit fantastic (pun intended), the article by William Hicks seems to be well-research and a bit above the usual lurid click-bait. Therefore I will not reproduce it in full here, but you can read the article here, if you are interested.


Shipping and the Olympics

Olympics vs Fleets

Team GB is having an amazing Olympics, and after watching the amazing symmetry of the pairs diving into a green swimming pool, I thought I would strive “Citius, Altius, Fortius” to find a tenuous link between shipping and the Olympics.

According to a genuine study entitled, “The Oxford Olympics Study 2016: Cost and Cost Overrun at the Games” by Bent Flyvberg et al of the Said Business School (University of Oxford, 2012, updated 2016), the Olympic games held over the last decade have cost, on average, USD 8.9bn to run. This is a huge capital cost, for what is sometimes a one-time use of the facilities. This average cost is equivalent to one tenth of the value of the Greek fleet. Indeed, compared to shipping, in economic terms, the stadia and facilities built to host a particular Olympic event can be seen as the means of production, in the same way as a vessel is the means of production in shipping.

The accompanying chart compares the cost of the means of production of both industries. In other words, the cost per event at the Summer Olympic Games between 1972 and 2016 (where data is available) and the average VesselsValue market value of the host nation’s fleet. Is there a correlation? No, there is no strong correlation, (the correlation is 0.40 for those who are interested), but we can pick out a few highlights from the data. The USA has the highest value fleet at an average of USD 25.7m per vessel (due to the requirements of the US Jones Act), but spending on Olympic events was only USD 3.3m per event for the 1984 Los Angeles Olympics, and USD 15.3m per event for the 1996 Atlanta Olympics. These figures are below the median of USD 20m per event.

The UK managed to spend the most at USD 40.5m per event at the 2012 London Olympics, but this does include the USD 90m spent on converting the main arena into a football stadium (for West Ham United FC). Interestingly, Brazil’s estimated cost per event is closely aligned to the average value per vessel in the Brazilian fleet (see chart). So while there is no link between shipping and the Olympics, there is some symmetry to be found, rather like watching the pairs diving into that green swimming pool.

Shipping Conference Schedules

I have just updated my shipping conferences and exhibitions calendar, and depending on your role in the industry, I propose two possible schedules.

The Shipping Marketing Executive:
The proposed conference schedule includes attending commodities conferences as well as purely shipping conferences.

1) Tuesday 6 September to Friday 9 September, Hamburg – SMM exhibition. At least one day is needed to go around the halls, preferably two, and the rest of the time attending conferences and meeting clients in Hamburg.
2) Monday 12 September to Wednesday 14 September, Miami – Kingman Sugar Conference. It’s amazing how few Shipping Executives actually attend the commodity conference of the cargo the company ships are carrying. Sugar is one of the most lucrative and highest value bulk trades, and it is worthwhile cultivating a few contacts.
3) Wednesday 21 September, New York – Tradewinds Shipowners Forum. A chance to check out what bankers are thinking when it comes to providing finance.
4) Thursday 29 September to Friday 30 September, Tokyo – Coaltrans. Another commodity conference, and a chance to find out just how poorly the Japanese shipping companies are faring. Will they be bailed out by the government?
5) Tuesday 11 October to Wednesday 12 October, Athens – Marine Money Greek Ship Finance. Every one can learn something from speaking to Greek shipowners.
6) Tuesday 25 October to Thursday 27 October, Copenhagen – Danish Maritime Fair. A new event on the calendar. Like Ireland, Denmark is pushing itself as a maritime hub, offering subsidies and other incentives. Could Copenhagen be the next “Singapore”?
7) Wednesday 2 November, South Korea – Mare Forum. South Korean shipping is going through another massive upheaval, driven by all the bankruptcies taking place. Will South Korean charterers behave honourably?
8) Tuesday 8 November, China – Mare Forum. The latest Five Year Plan (No 13, if you are counting) emphasis streamlining state-owned companies. Mergers among Chinese state-owned companies are already taking place, and this conference would be a good place to ask the question – what does the latest Five Year Plan mean for shipping?
9) Tuesday 15 November, Thailand – World Rice Trades. A notoriously difficult trade to enter, but very lucrative if you have the right contacts. Not making shipping people make the effort to attend this or the Coaltrans conference, which could give you a clear run at the cargo owners.
10) Thursday 17 November to Friday 18 November, Manila – Coaltrans. The coal trade from the near Far East to India has been supporting bulker trades in the near East. How long will imports to India last?

The Ship Finance Banker:
Back in the day, a shipping finance conference meant only one thing; the Lloyd’s Shipping Economist Ship Finance conference at the Hyatt. Informa led the market in shipping finance conferences, but those days are long gone, and Informa does not appear to have a ship finance conference listed for this Autumn. However, there are plenty of alternatives.
1) Tuesday 27 September, Monaco, – Superyachts Marine Money.
2) Thursday 29 September, Monaco – Superyachts Mare Forum. There is still plenty of ship owners and two Superyachts conferences in one week in the same location is too good an opportunity to pass up.
3) Tuesday 10 October to Wednesday 11 October, Greece – Marine Money.
4) Tuesday 18 October, Monaco – Mare Forum. Back to Monaco.
5) Thursday 27 October, Rotterdam – Mare Forum. The Dutch banks have been quietly lending to select clients. Find out how they do it.
6) Wednesday 9 November, New York – Marine Money. A mid-week conference in New York gives plenty of opportunity to meet clients throughout the week.
7) Tuesday 15 November, London – Riviera Tanker Trade & Outlook. Not a shipping finance conference per se, but tankers have, until recently, been on of the few bright spots in the industry.

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