Singaporean bulker operator’s chief executive is confident that the dry-bulk segment will rally in the coming year.
Oslo-quoted Pioneer Marine reported a third-quarter loss latest earnings report Pankaj Khanna argued that the return of freight rate volatility suggests the balance between supply and demand is starting to improve.
The industry veteran believes a decline in Chinese coal imports are, in part, responsible for postponing a rebound that many had expected to materialise in the second-half of 2014.
Pioneer Marine CEO Pankaj Khanna said
"The market recovery has been delayed due to the 7% decline seen in Chinese coal imports (January through September 2014 versus prior period) precipitated by a 24% surge in hydro‐electric production in the same period.However, forecasts for 2015 suggest that Chinese coal imports may rebound as hydro‐electric production returns to more normal levels."
Pioneer Marine CEO Pankaj Khanna
believes demand for minor bulks was impacted by the ban on Indonesian exports of unprocessed minerals but said he is now starting to see long-haul trades of bauxite from West Africa to China.
Pioneer Marine CEO Pankaj Khanna said
“Overall drybulk demand forecasts for 2015 are still in the 5 to 7% range based on volume alone and not accounting for the tonne‐mile effect for example from rising Brazilian iron ore exports.We remain cautiously optimistic about the prospects for 2015.”
The commentary came as the handymax specialist Pioneer Marine reported a loss of $5.0m for the three months to 30 September. Handymax specialist Pioneer Marine operator noted it recently lined up a $156.6m credit facility that will be used to finance a portion of its newbuilding programme and said it expects to receive further commitments from lenders in the coming weeks.
Pioneer Marine has now built a handysize focused operating platform and is among the top 15 handysize owners,” Khanna added. “We are positioned to consolidate this fragmented sector further with like‐minded operators and financial sponsor-backed companies.”