High Shipping Costs Are Here to Stay, Says Bloomberg
By Henry Ren (Bloomberg) Stubbornly high shipping expenses for businesses are getting sealed into contracts for the next 12 months, forcing companies to pass the extra costs on to consumers....
Golden Ocean Group Limited announced today the acquisition of a 50 percent stake in a 2010 Korean-built 181,000 dwt Capesize bulk carrier and one 2010 Chinese-built 29,200 dwt Handysize bulk carrier. According to Golden Ocean, the other 50 percent partner in the acquisition is a “cargo owner.”
The vessels were delivered upon the signing of the contract on September 3, 2013.
In Golden Ocean’s press statement, the company notes, “The Board is of the opinion that it has obtained a favorable price and considers risk / reward as attractive from a historical perspective.” Dire warnings on the future of the dry bulk industry, in particular mineral resources, have been recently noted in articles by Jay Goodgal, Managing Member of Castalia Advisors.
In Goodgal’s article, China’s Economic Stimulus and the Short-Term Dry Bulk Shipping Impact he notes that “government stimulus, not property construction, is now driving growth” in China. This is having a short term positive affect on the dry bulk market, but Goodgal sees an inevitable crash on the horizon as this is a liquidity-driven event, not one reflective of real expansion.
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