It’s a sign of the times that the only time I managed to get any time for reflection was earlier this afternoon in the dentist’s chair. The good news was that I managed to escape root canal work, for now at least. The bad news is I had someone digging around in my mouth for an hour without anesthetic – I am not anti-vaccination, but I am anti not feeling what they are doing to me – and I now have the reminder of that digging shooting around one side of my mouth. At one point an image came into my mind of my mouth being open like the hood of a car, with a muscular mechanic banking away at my teeth with hammers, pulling bits out with pliers, and all his strength to push things back into place. The imagination takes on another dimension when you are staring at the ceiling trying to open your mouth even wider.
Anyway, for the squeamish amongst you, I will stop talking about teeth, and share with you some thoughts which flashed through my mind about today’s dry cargo market whilst looking at the ceiling:
1) When some steam is being taken out of the market, where is it being taken? Who has turned off the heat?
2) As the physical market follows the paper market down, we are faced with the very strange phenomenon, in a firm market at least, where the handysize index is almost, by a few dollars only, as much as the kamsarmax. This has been observed in a bad freight market but not vice versa, at least I can’t remember. Instead of splitting cargoes into smaller ships, shouldn’t we do the reverse? Why not double the stem and put them in ultramaxes or kamsarmaxes instead? I appreciate that some ports cannot take these larger ships, but once again economies of scale don’t seem to be working quite as they should.
3) If you are the only buyer for a vessel, and you have no immediate competition, why pay more than last done? Are you that desperate for a ship at any price? If that is the case, then you will surely pay any price, one that only serves to inflate values more. Unless that is what you want…
4) You authorise your broker to indicate for a vessel that you want to buy/charter. Your indication is rejected without counter. Why ask the same question again through another broker? Do you think brokers are supermen or magicians? All that will happen is that the owners will think there is more interest for their ship than actually exists which makes the price/freight/hire even more out of reach. Pay up, or stop it.
5) What’s the difference between a purchase enquiry and a serious purchase enquiry? Does a serious purchase enquiry mean that the buyers will pay more money? That they have more money to spend? And does a very serious buyer mean that they look very carefully at all the details of the ship, and spend two days reading an offer? Wearing glasses, a suit and smoking a pipe?
6) Likewise, Is a serious seller someone who doesn’t tell jokes? Or doesn’t like being made fun of? Is the opposite of a serious seller a trivial seller? A superficial seller? A jovial seller? A flippant seller?
7) When you ask someone “when will this market end?” do you really expect a proper answer? Do you honestly think that anyone out there knows the answer? And if they did that they would tell you?
I could go on, but you know what thoughts are like when you are trapped in a chair with someone else’s fingers in your mouth, and you have nothing else to concentrate on or distract you. For me at least relevant thoughts follow irrelevant ones, and chase each other around in no particular direction, with only a bit of pain to focus the mind, which is an apt description of a broker’s life in a market like this.
So rather than try and bring some clarity to a messy week, I will leave my brother and sister sale and purchase brokers with one final thought. If you feel upset and frustrated that you are not doing any business at the moment, look at the reports of ships sold and bought, and identify those deals that you could have done. Look at them again, and be honest with yourself: did you really have a chance? If you did, you have my sympathies, but stop moaning and identify the reasons why you didn’t do the deal and change your game plan, not just immediately but for the long term. If you can’t identify any deals you could have, should have done, then your either your clients have not been active, they have but they didn’t manage to buy or sell anything so far. Either way you still have a chance. This may sound like small comfort when everyone else is apparently doing deals around you. Ignore the chatter and the noise, and focus on the possible. That is what I will be telling myself anyway.