Ton Mile Trader

Jonathan Chappell – Key Takeaway from JPM Transportation Conference:  Emerging Markets: China (and India) should continue to drive robust commodity demand. Management teams from both dry bulk and tanker companies as well as the keynote lunch presentation by Lawrence Eagles provided a consistent message about the sustainability of emerging market commodity demand. That message was that it should remain robust. Several graphs and charts highlighted the strength of Chinese imports of iron ore, coal, and oil and a few others highlighted the increasing impact of a rapidly expanding Indian economy, particularly in regard to coal demand. Furthermore, Mr. Eagles stated that his global oil demand forecasts consist almost entirely of emerging market oil demand growth, as the OECD nations are expected to remain relatively stagnant in 2010. Of note, though, there was no  mention of the potential scaling back of Chinese stimulus lending and the impact that tightening monetary policy would ultimately have on infrastructure spending, steel production, and commodity imports. In our view, Chinese monetary policy remains a risk, particularly to the dry bulk market.

- Dag Kilen/Frode Morkedal downgrade D/S Norden to REDUCE (from add).  Target is unchanged from DKK 234.  “…currently trading at…fair value.”
- Dag Kilen/Frode Morkedal maintain BUY on Torm ($15)
- Martin Korsvold maintains HOLD on Torm (DKK 55).
- Anders Karlsen maintains BUY on Independent Tankers and raises target to $1.21 (from $0.95).

Omar provides container stats:  Inbound container volume at the Port of Long Beach was up near 39% y/y in February. Throughput of 207,920 TEU was up sharply from the February 2009 level of 149,230, the weakest month of last year. Daily inbound throughput of 7,420 TEU is also up from the January volume of 7,030 TEU. Container throughput has been steadily improving since midway through last year, with December 2009 inbound volume showing the first y/y gains since May of 2008