The bulk carrier Tokyo Bulker passing the Golden Gate Bridge on its way from San Francisco to Lanshan, China 2016 – A Year of Huge Ups and Downs in the Dry Bulk Carrier Market After the Baltic Dry Index (BDI) hit a historic low of 290 points in early February this year, creating a sentiment of pessimism across the industry, the bulk carrier sector began to make its climb toward recovery. The year began positively, with the BDI standing at 473, and then the bottom fell out on February 10. For the capesize sector, things continued to fall to the darkest depths – the nadir being on March 17. By ..read more

Capesize bulk carrier Cape Elise Capesize Market Getting Some Encouragement – but how long-lived can it be? The Capesize Market report from the week ending September 16, 2016 shows rates improving, but no one quite seems to know why, and there is even less certainty about how long it can last. In fact, experts can’t even say why the market fell to such disastrous lows earlier this year in the first place. Therefore, while the improvement in rates is very welcome, it is also met with a great deal of very cautious optimism. The August fleet statistics report did not give cause for celebration ..read more

The Brexit Effect All Eyes on Brexit, but Has This Caused Inertia in the Markets? The impending exit of Britain from the EU in 2019, has so absorbed the minds of the international financial community. Prior to the vote, there were many doomsday predictions, none of which have materialized to date. For instance, before the vote it was predicted that the equity and bond markets would collapse if Britain were to leave. However, post-Brexit, the global bond and equity markets are doing very well. And Britain has not become ostracized, as evidenced by GlaxoSmithKline’s announcement that it intend ..read more

Industry analysts and shipping companies are continuing to look for hard signs of a permanent recovery in the dry bulk shipping market. However, a complex weave of influences across the globe is keeping the picture rather murky. Baltic Dry Index On the one hand, the Baltic Dry Index (BDI) finished last week at 745, more than twice the value it stood at in February, when it hit a record low. But do remember that this increase is off a horrendous all-time low point. Therefore, the increase is still anemic and nothing to be excited about. If anything, the record lows were so low as to be unsustai ..read more

Big news hit the headlines this week with the announcement of the mega merger between Chinese steelmakers WISCO and Baosteel. Once merged, the two firms will become the second largest steel company in the world, causing some to fear that there will be a negative impact on iron ore demand due to a reduction in producers. But industry experts seek to assuage those concerns, pointing out that the last producers still left standing, following mergers and acquisitions, tend to be more strategically located along the coast, with easy access to global iron ore imports, which are of better quality and ..read more

In a little less than a month, I will be joining my father and sisters for the grand opening of a very special educational center named in honor of my mother, Ruth Mulan Chu Chao. Our mother was a formidable woman in her own right, serving as an inspiration not only to us, but to a large community of Asian Americans who witnessed her dedication to education, history and philanthropy. Harvard Business School’s new Ruth Mulan Chu Chao Center will open its doors on June 6th, and as a fitting tribute to my mother, will be the first building on campus named for a woman and for a person of East Asia ..read more

“Markets are constantly in a state of uncertainty and flux, and money is made by discounting the obvious and betting on the unexpected.” (George Soros) This may be the best piece of advice we can cling to these days, as any effort to predict and benefit from market performance is going to take a great deal of patience and daring. Across the spectrum, from raw materials to real estate, we see a shifting landscape of improvement and decline, rises and collapses. Let’s begin with oil prices. Brent hit a low of $27 per barrel in late January, and there were expectations of even lower pri ..read more

Crude Oil prices over last 6 month – graph from Nasdaq The market continues its rollercoaster performance, leaving investors and their advisers dizzy from the predictions and actualities. A case in point is the performance of crude oil. When prices dropped to $27 per barrel, the conventional wisdom coalesced in pessimism and that this trend was heading only in one direction—downward. Combined with gloomy reports about faltering economies around the world, especially China’s slowdown and the abundance of crude oil on the market, it seemed to be the perfect time to invest in shorts, which many ..read more

OPEC’s aggressive strategy of flooding world markets with an abundance of oil appears to be meeting its target goals of deflating competition from other producers. Primarily concerned about what was a booming shale oil market, OPEC’s strategy has impacted all oil producers in a multitude of sectors. Success is giving OPEC the incentive to continue to squeeze producers working in the Caspian, Arctic and Brazilian waters, and shale oil is definitely showing the results in America, where it accounts for as much as 45% of total spending cuts. Large companies have announced significant reductions i ..read more

It is too soon to know for sure if we have turned the corner on the gloom period, but there are many interesting benchmarks from the first quarter of 2015 to give cause for a little optimism. Crude Oil Let’s look at the American crude oil situation, for example. In spite of predictions of a weakening or flattening market, US crude oil output actually rose in May to a level not seen in 43 years. Output reached 9.6m b/d. End-user demands, such as from US refineries is pushing this surge, as is evidenced by the fact that more than 1m b/d of oil is being consumed than supplied from imports and do ..read more