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Monday, 23 August 2010

Who you gonna call?

(You are getting this note because you subscribed to The Shipping Blokes Blog by Brad Skelton)

I have noticed a significant shift in the market recently with many large, high volume shippers who have previously had direct deals with shipping lines gravitating back toward freight forwarders.

Shipping lines have been fighting to stay profitable and as a result are frequently changing ships, retrenching staff, dropping port calls or still have some fleet laid up resulting in lack of capacity and short shipments. The reality is that many shipping lines service levels have been faltering. I think I can say without exception every client is fed up with dealing with so called "Customer Service" centres on 1800 numbers.

So who you gonna call? Freight forwarders!

Shrewd shippers are using forwarders to help overcome these things. The forwarders are generally better positioned and resourced in meeting the needs of shippers right now and will offer a broader range of options rather than just one carrier. The range of services is usually broader too and in the volatile freight market we have had for quite a while, the forwarders are more attuned to where the deals are.

Best of all...you don't sit on hold in a phone queue waiting for ages to talk to someone and then being told "Go to www." to do that!

All for now,

Brad Skelton

The Shipping Bloke.

Who you gonna call?

(You are getting this note because you subscribed to The Shipping Blokes Blog by Brad Skelton)

I have noticed a significant shift in the market recently with many large, high volume shippers who have previously had direct deals with shipping lines gravitating back toward freight forwarders.

Shipping lines have been fighting to stay profitable and as a result are frequently changing ships, retrenching staff, dropping port calls or still have some fleet laid up resulting in lack of capacity and short shipments. The reality is that many shipping lines service levels have been faltering. I think I can say without exception every client is fed up with dealing with so called "Customer Service" centres on 1800 numbers.

So who you gonna call? Freight forwarders!

Shrewd shippers are using forwarders to help overcome these things. The forwarders are generally better positioned and resourced in meeting the needs of shippers right now and will offer a broader range of options rather than just one carrier. The range of services is usually broader too and in the volatile freight market we have had for quite a while, the forwarders are more attuned to where the deals are.

Best of all...you don't sit on hold in a phone queue waiting for ages to talk to someone and then being told "Go to www." to do that!

All for now,

Brad Skelton

The Shipping Bloke.

Sunday, 8 August 2010

Far East shipping industry recovery is well underway!

(You are getting this note because you subscribed to The Shipping Blokes Blog by Brad Skelton)

I have been travelling the last week or so in the Middle East and Far East visiting clients and shipping lines and some of my agents in these places. Recovery from the global economic downturn, particularly with shipping lines in the Far East, is now well underway with some carriers forecasting things should be back to normal by the end of the year.

An example is Singapore owned, Neptune Orient Lines(NOL). NOL is the fifth largest container carrier in the world. After reporting a US$741m loss last year NOL expects to deliver a US$70m profit for the full year this year. Furthermore all vessels that NOL laid up to ride out the downturn are now back in service and they intend to start acquiring more. Similarly an even more spectacular turnaround is being delivered by Orient Overseas International who posted a US$1.28b profit for the first half compared with a loss for the same period last year of US$232m.

Maersk Lines, the worlds largest container carrier, has forecast they expect to return to profit this year after seven terrible consecutive loss making quarters.

Most carriers I have spoken to are hoping to be able to gradually increase rates later this year by 10-15% as space contracts on their ships again.

I am really getting the sense now that the pulse of global industry is shifting to Asia with more companies focusing on this region and the extraordinary opportunities and growth that exists here. Some are even shifting their head offices from Europe and the US to the Far East. Obtaining finance from banks and doing business in general, is easier than alot of other places in the world and the economies are less credit driven.

For my industry something that punctuates this for me is that there is a challenger to the Baltic Shipping Index coming out of China that is getting more prominent. It is called the China Containerised Freight Index and provides a benchmark index for container freight rates. At the end of June it had risen to 1171 points compared with 763 a year ago.

All in all things are looking very positive again and I think we'll be back to battling for space on ships again very soon....in fact in a few tradelanes we already are.

All for now,

Brad Skelton

The Shipping Bloke

Far East shipping industry recovery is well underway!

(You are getting this note because you subscribed to The Shipping Blokes Blog by Brad Skelton)

I have been travelling the last week or so in the Middle East and Far East visiting clients and shipping lines and some of my agents in these places. Recovery from the global economic downturn, particularly with shipping lines in the Far East, is now well underway with some carriers forecasting things should be back to normal by the end of the year.

An example is Singapore owned, Neptune Orient Lines(NOL). NOL is the fifth largest container carrier in the world. After reporting a US$741m loss last year NOL expects to deliver a US$70m profit for the full year this year. Furthermore all vessels that NOL laid up to ride out the downturn are now back in service and they intend to start acquiring more. Similarly an even more spectacular turnaround is being delivered by Orient Overseas International who posted a US$1.28b profit for the first half compared with a loss for the same period last year of US$232m.

Maersk Lines, the worlds largest container carrier, has forecast they expect to return to profit this year after seven terrible consecutive loss making quarters.

Most carriers I have spoken to are hoping to be able to gradually increase rates later this year by 10-15% as space contracts on their ships again.

I am really getting the sense now that the pulse of global industry is shifting to Asia with more companies focusing on this region and the extraordinary opportunities and growth that exists here. Some are even shifting their head offices from Europe and the US to the Far East. Obtaining finance from banks and doing business in general, is easier than alot of other places in the world and the economies are less credit driven.

For my industry something that punctuates this for me is that there is a challenger to the Baltic Shipping Index coming out of China that is getting more prominent. It is called the China Containerised Freight Index and provides a benchmark index for container freight rates. At the end of June it had risen to 1171 points compared with 763 a year ago.

All in all things are looking very positive again and I think we'll be back to battling for space on ships again very soon....in fact in a few tradelanes we already are.

All for now,

Brad Skelton

The Shipping Bloke

Saturday, 12 June 2010

If you have never Googled yourself...do it now!

(You are getting this note because you subscribed to The Shipping Blokes Blog by Brad Skelton)

This is a classic "Don't let this happen to you" story that I wanted to share with you.

I recently Googled myself and my company to check how we were being ranked.

I was surprised to find that another company popped on the first page of my search because they were using my name, Brad Skelton, and my company's buyline, the Choice of Heavy Industry, in their own website's page address without my permission. I have no association whatsoever with this company.

They obviously thought they could leverage my name and company's reputation to throw peoples hunt for us off track with internet search engines. They were effectively mis-representing themselves in an effort steal our web traffic and some business that was destined for us in the first place.

I am flattered that another company thinks so highly of mine that they would blatently leverage our name and good reputation for their own gain. Such must be their own realisation of their increasing irrelevance to the market and their inability to innovate themselves.

Well, Skelton Sherborne and I are the REAL DEAL and won't do unethical things to grow our business. I promise you now if I ever feel I need too, then I'll know it's time for me to find another gig.

All for now,

Brad Skelton

The Shipping Bloke

If you have never Googled yourself...do it now!

(You are getting this note because you subscribed to The Shipping Blokes Blog by Brad Skelton)

This is a classic "Don't let this happen to you" story that I wanted to share with you.

I recently Googled myself and my company to check how we were being ranked.

I was surprised to find that another company popped on the first page of my search because they were using my name, Brad Skelton, and my company's buyline, the Choice of Heavy Industry, in their own website's page address without my permission. I have no association whatsoever with this company.

They obviously thought they could leverage my name and company's reputation to throw peoples hunt for us off track with internet search engines. They were effectively mis-representing themselves in an effort steal our web traffic and some business that was destined for us in the first place.

I am flattered that another company thinks so highly of mine that they would blatently leverage our name and good reputation for their own gain. Such must be their own realisation of their increasing irrelevance to the market and their inability to innovate themselves.

Well, Skelton Sherborne and I are the REAL DEAL and won't do unethical things to grow our business. I promise you now if I ever feel I need too, then I'll know it's time for me to find another gig.

All for now,

Brad Skelton

The Shipping Bloke

Thursday, 6 May 2010

The Japanese car carriers are back..cars sales must be down.


(You are getting this note because you subscribed to The Shipping Blokes Blog by Brad Skelton)

You can always tell car sales globally are down when the Japanese car carriers start chasing business for high and heavy cargo, like earth moving machinery, that usually holds little or no interest for them. You have to try and fill those ships somehow in a downturn.

From my perspective the GFC has had both positive and negative impacts on the RoRo (roll on/roll off) shipping market.

One of positives includes rates coming back to earth. Probably too low to be brutally honest as we are still seeing rates in the market at levels I haven't seen since the 1980's. The carriers cannot sustain these levels for much longer so I firmly believe increases are just around the corner.

Carriers have been scrapping older ships which are less fuel efficient, and operationally constrained with their lower ramp capacities and speeds. This is a double edge sword though. While it is actually good to move the older girls on, with fewer vessels working it has meant that sailing frequency has dropped in many trade lanes and this combined with slower steaming speeds, to save fuel, means that you may have to wait longer than usual for your cargo to arrive.

In an effort to fill their vessels RoRo carriers have been calling at more out ports. In other words, calling at ports that are normally not scheduled and going where the spot packages of cargo are. Prior to the financial crisis it was simply not possible for carriers to even consider a deviation from the main ports. With demand strong, they were under too much pressure from their big customers to get that cargo to market. NOW!

Out of adversity there is always opportunity for enterprising people. We have seen some new carriers enter the market such as Partner Shipping's NAPA service which has brought real competition to the market between North America and Australia. We have also seen other carriers, like Wallenius Wilhelmsen, enhance their USWC transhipment services via Manzanillo. both of these things are a win for shippers.

So, what's next?

I think it depends a fair bit on what is happening economically in Europe right now however assuming cargo volumes continue improving, then freight rate restoration will soon be inevitable. As global demand for cars comes back, then if they run true to past form, we'll be saying "sayonara" to the Japanese car carriers again until the next downturn.

All for now,

Brad Skelton

The Shipping Bloke