Dry Bulk Stocks Show Signs of Life -- Tankers Continue to Struggle
09 November 2011 - 12:16AM
Marketwired
The shipping sector has been posting a modest rebound this year due
to a recovering global economy and strong overseas demand. The
industry's recovery has been far from smooth, however, as surging
fuel prices, a fluctuating freight market and a glut of ships
continues to hurt growth. The Bedford Report examines the outlook
for companies in the Shipping Industry and provides investment
research on General Maritime Corporation (NYSE: GMR) and Frontline
Limited (NYSE: FRO). Access to the full company reports can be
found at:
www.bedfordreport.com/GMR
www.bedfordreport.com/FRO
The traditional indicator of the shipping industry's health and
real time assessment of demand for global raw materials, the Baltic
Dry Index (BDI), recently hit a one-year high, up more than 60
percent from its February low. Although the BDI is not an index of
profitability for shippers, it does reflect increased revenue for
those shippers focused on the spot market.
According to Reuters, the rally has been driven by firmer coal
and iron exports from Australia to China had boosted the capesize
market. Chinese imports of iron ore have increased for two
consecutive months and to the highest since January, customs data
show. China, which buys about 62 percent of all seaborne iron ore
supply, will expand 9.3 percent this year and 8.7 percent in 2012,
according to the median of 10 economists' estimates compiled by
Bloomberg.
The Bedford Report releases stock research on the Shipping
Industry so investors can stay ahead of the crowd and make the best
investment decisions to maximize their returns. Take a few minutes
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The oil tanker industry remains in disarray, however. BW
Maritime recently underlined the grim prospects facing oil tanker
owners after it became the first owner to admit having laid up a
ship out of service in the face of this year's slump in vessel
charter rates. In North America and Europe, oil demand is way down.
Western countries already were expected to see declining demand as
their economies struggle to grow. Those concerns grew when the U.S.
reported unexpectedly large crude supplies and weak gasoline
demand.
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