Equity markets not grasping the current VLGC-strength
Fra dagens Pareto Shipping Daily
The Baltic has continued to climb throughout this week, with rates now above USD 40/ton for the first time this year. Yesterday the index was up another 1.8%, to a TCE equivalent rate of ~USD 24,700/day. With ships being diverted away from the MEG to benefit from the even stronger Western market, brokers are now saying that the earliest available ship in the Middle East has been put on subjects by an Indian charterer for a loading in mid-April. There are reportedly a few more Indian requirements before the end of April, which may have to depend on re-lets to secure tonnage. What is very positive is now that some cargoes have been fixed over a month in advance – vs. as little as a week in advance earlier this year
In the US, momentum remains firm. Three Marcus Hook cargoes have been covered this week, and the US Gulf loadings for well into May are now being worked. This means that we are seeing fixing windows of 6-7 weeks – and that part of the market is almost starting to resemble the good times of 2014/15 (of course not the rates)
Dorian has fixed the Copernicus for a cargo to load in mid-May at a US – Chiba rate of USD 77/ton – which implies around USD 30,000/day. Brokers say that ‘some Owners’ are now trying to push rates up to USD 80/ton
We believe the equity markets are not at all grasping how healthy the VLGC market has become. Currently we are seeing plenty of margin for midstream companies, trading houses and Asian importers (reports on Bloomberg yesterday of how Asia is lacking enough propane volumes). With more than enough price spread to pay shippers USD 80/ton the market is suddenly above parity levels. Moreover, this improvement has been gradual and ‘controlled’, with no signs of LPG shortage in the US or oversupply in Asia. With fixing windows now increasing steadily we are getting much more visibility. Yes, more newbuilds will be delivered, but any balance sheet worries for the VLGC companies should in our view be forgotten now – in stark contrast to the steep NAV-discounts that the names are suffering from
The Baltic has continued to climb throughout this week, with rates now above USD 40/ton for the first time this year. Yesterday the index was up another 1.8%, to a TCE equivalent rate of ~USD 24,700/day. With ships being diverted away from the MEG to benefit from the even stronger Western market, brokers are now saying that the earliest available ship in the Middle East has been put on subjects by an Indian charterer for a loading in mid-April. There are reportedly a few more Indian requirements before the end of April, which may have to depend on re-lets to secure tonnage. What is very positive is now that some cargoes have been fixed over a month in advance – vs. as little as a week in advance earlier this year
In the US, momentum remains firm. Three Marcus Hook cargoes have been covered this week, and the US Gulf loadings for well into May are now being worked. This means that we are seeing fixing windows of 6-7 weeks – and that part of the market is almost starting to resemble the good times of 2014/15 (of course not the rates)
Dorian has fixed the Copernicus for a cargo to load in mid-May at a US – Chiba rate of USD 77/ton – which implies around USD 30,000/day. Brokers say that ‘some Owners’ are now trying to push rates up to USD 80/ton
We believe the equity markets are not at all grasping how healthy the VLGC market has become. Currently we are seeing plenty of margin for midstream companies, trading houses and Asian importers (reports on Bloomberg yesterday of how Asia is lacking enough propane volumes). With more than enough price spread to pay shippers USD 80/ton the market is suddenly above parity levels. Moreover, this improvement has been gradual and ‘controlled’, with no signs of LPG shortage in the US or oversupply in Asia. With fixing windows now increasing steadily we are getting much more visibility. Yes, more newbuilds will be delivered, but any balance sheet worries for the VLGC companies should in our view be forgotten now – in stark contrast to the steep NAV-discounts that the names are suffering from
Pølsebua
29.03.2019 kl 17:36
1000
Pussig. Dagens vinner uten kommentarer. Varslet før åpning med Paretos analyse her. Jeg har fulgt denne siden børsnotering, og gikk inn igjen for tre uker siden, og med mer sist tirsdag. Flyttet penger i dag, og kjøper mer på mandag. Nå skal jeg sitte inn i 2020. Kan tjene 5 kr pr år pr aksje neste år. Fortsatt etter Paretos framtidsvurdering. Verdt å vente på. I så fall er aksjen priset rundt 50, uten at jeg skal spå det. På tross av makrotrussel tenker jeg kjøp og sitt..