I ask the TonMileTrader readership a question I cannot answer.  On Tuesday December 20^th 2011 the tweendeck operator (TBSI) notified all via a press release that they had finally come to terms with its lenders.  In that same release they tell folks that the terms of the agreement do not provide for any remaining value in the outstanding ordinary or preferred shares of TBS.  How or why would this stock still be trading?  Please help an old shipper figure this out. 

Press Release: TBS International plc – Tue, Dec 20, 2011 “The terms of these agreements do not provide for any remaining value in the outstanding ordinary or preferred shares of TBS.”

December 26^th 2011

Ski Notes:  The Island People (TBSI) came to an agreement with some of its lenders that saw four of its new vessels snatched (like repossessed) and value of its existing shares eliminated “The terms of these agreements do not provide for any remaining value in the outstanding ordinary or preferred shares of TBS.” yet… I watched the market trade up the shares on the NASDAQ.  The shares opened at 22 cents and gained 68% trading briefly at 37 cents a share.   Hello People…

 Thanks

Dave

From our buds at the USDA

During the week ending January 26, 38 ocean-going grain vessels were loaded in the Gulf, down 22 percent from last year. Fifty-three vessels are expected to be loaded within the next 10 days, 36 percent less than the same period last year.

During the week ending January 27, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $49 per mt, down 4percent from the previous week. The cost of shipping from the Pacific Northwest to Japan was $26 per mt—down 4 percent from the previous week.

Although higher than during the global financial meltdown of 2008 and 2009, ocean freight rates for shipping bulk commodities, including grain, have been moderately low during 2011. Ocean freight rates were kept low in part by record deliveries of new vessels to the fleet, fueled by a wave of optimism about the anticipated pace of global economic recovery. In addition, natural disasters such as flooding in the coal-producing regions of Eastern Australia and cyclones in the iron ore exporting regions of Western Australia reduced trade volumes and, consequently, rates.

Now and A Look Beyond: As of January 27, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $49 per mt, 4 percent less than the previous week. The cost of shipping from the PNW to Japan was $26 per mt—4 percent less than the previous week. As indicated by the Baltic Drybulk Index which has been falling recently, ocean freight rates may continue at these low levels. The Chinese Lunar Year Holidays also contribute to the depressed rates. Most industry analysts are projecting a bleak future for the freight market, at least in the near term, because bulk vessel supply continues to outpace demand due to slower than expected global economic recovery. Low or moderate ocean freight rates may bode well for U.S. grain shippers by moderating the landed costs of ocean-going U.S. grain exports.

Surajudeen.olowolayemo@ams.usda.gov

Will History Repeat Itself in This Shipping Cycle?

Historic Developments
Shipping today does not have much to joke about. 2012 opened with weakening freight rates, and the Clarksea index ended January at $8,585/day, the lowest since the index started in 1990. But the market has dipped to similar levels three other times. The first was in May/June 1992 when it bottomed out at $8700/ day. The second was April 1999 when it fell to $8732/day and the third when it slumped to $8,698/day in January 2002. Does this mean the market has hit bottom?

Repeating History Hopefully?
Let’s take a look at what happened after the market bottomed out on the last three occasions. To do this... (full article here).

The Baltic Exchange:  BDI =647 (-10.88%), BCI =1436 (-1.98%), BPI =693 (-14.97%),BSI =608 (-12.52), BHSI =382 (-10.33%).  The panasisters take lead spanking with the other smaller fleets in tow. 

The Fixtures:  Ore =13, Coal =9, T/C =68, Period =7, Grain =3, total =100.  Ore chores come in below the 4 week average 13.75 fixes… way short of our healthy market target of 30.   The coal fixtures come in below the 4 week average 11 fixes. 

            Best done period vs. spot

Capes:  none reported                                            vs. $5,327.

Pmax:  Global Bonanza  10-14 MOS     $10,000  vs. $5,515.                       

Smax:  Amoy Dream      3-5 MOS          $9,000    vs. $6,657.

The Vessels:  VLOC =0, Capes =13, PostP =4, Kmax =9, Pmax =33, Smax =35, Hmax =2, Hsize =0, Bulkers =4, total =100.

Ski Notes:

No capes on period 2 weeks in a row

More Supramax vessels found employment compared to the “workhorse” Panamax fleet.

US is moving more coal by sea than the rest of the globe.  Or close to it!

Junk fixtures may start to appear as owners reposition vessels near primo layup locations, and yes this promotes further decay of the indexes.   

EGLE was alerted short @1.43 and has since lost 4.90% but we call it flat.  Maybe next time!

Good Fortunes

Link: http://www.lifeinvestmentseverything.blogspot.com

Mon, January 30, 2012 at 20:59 | MaskedInvestor

Great job with the NNA bond article.  Best of Luck and don't forget to keep on reading the TMT.

Dave 

During the week ending January 19, 41 ocean-going grain vessels were loaded in the Gulf, down 11 percent from last year. Fifty-two vessels are expected to be loaded within the next 10 days, 32 percent less than the same period last year.

During the week ending January 20, the ocean freight rate for shipping bulk grain from the Gulf to Japan was $51 per mt, unchanged from the previous week. The cost of shipping from the Pacific Northwest to Japan was $27 per mt—unchanged from the previous week. 

On Monday, January 23, workers returned to work on the Panama Canal expansion project, ending a 6-day strike. The $5.25 billion expansion will double the canal’s capacity when completed in late 2014. The strike did not affect traffic transiting the canal. During fiscal year 2010, close to 31 million metric tons of U.S. grain exports to Asia transited the canal.

WASHINGTON, Jan. 26, 2012--The U. S. Department of Agriculture will release new 10-year agricultural projections Feb. 13 at 12:00 noon EST. The USDA Agricultural Projections to 2021 report will be released on the Office of the Chief Economist web site at www.usda.gov/oce. USDA publishes the projections each year in February.

Top & Bottom 5 Day:  SBLK @1.12(+21.74%) EGLE @1.43(+18.18%) SB @7.28(+9.15%), >>> BALT @4.12(-8.04%), EXM @1.46(-8.75%), SHIP @2.16(-8.86%).  The driver behind SBLK enjoying 5 consecutive days of gains totaling over 20% is???   For the last 3 weeks EGLE has placed in the top 3 of the T&B5Day now qualifying for a double short alert.  This is somewhat explained below in Ski’s notes.  On the flip side we see SHIP has qualified as a laggard 3 consecutive weeks however we withhold alerting any trades. 

The Baltic Exchange:  BDI =726 (-15.78%), BCI =1465 (-5.73%), BPI =815 (-20.10%), BSI =695 (-13.88%), BHSI =426 (-12.16%).  The Panasisters taking a spanking during decent coal demand just don’t add up like in the past.  The market cannot find support with above average coal demand so guess what will happen in a few weeks when the coal tapers off?  Slowly read that last sentence again !

The Fixtures:  Ore =10, Coal =12, T/C =45, Period =4, Scrap =1, total =72.  According to RS Platou there were no fixtures reported on the 25^th.  Story here is the coal runs out numbering the ore chores.  More Kadywhompusness! 

Best Done Period vs. spot rates

Capes:  none reported                                             vs. $5,732.

Pmax:  DIMITRIS APESAKIS   4-7 MOS $11,250 vs.$6,882.

Smax:  Densa Jaguar                3-5 MOS $10,500 vs.$7,534.

The Vessels:  VLOC =0, Capes =14, Post P =1, Kmax =5, Pmax =27, Smax =10, Hmax =5, Hsize =3, Bulkers =7, total =72.

Ski Notes:  It has been our experience that if a shipping equity leads or lags the sector for 2 consecutive weeks a contrarian bet has good results.  If we then have that same equity lead or lag for a third consecutive week the contrarian bet is even more often a rewarding gamble.  It is now EGLE that has outperformed the entire sector for 3 weeks and is a double alert regardless of any rumors of consolidation.  Boomer James shorts EGLE.   

SHIP...because the market value of the publicly held shares ("MVPHS") of the Company's common stock for 30 consecutive business days, from December 6, 2011 to January 23, 2012, was below the minimum requirement of $5,000,000 for the continued listing on the Nasdaq Global Market, the Company is not in compliance with Nasdaq Listing Rule 5450(b)(1)(C). The applicable grace period to regain compliance is 180 days.