Just when the dry bulk market was about to regain some momentum after the Christmas and New Year holidays, we witnessed yet again talks about the New Year festive season being reason for another expectedslowdown in shipping activity.
We are about to enter the Lunar New Year celebration, or Chinese New Year. Not only do we need to prepare for the world’s biggest emigration of people but a slowdown in Chinese import and export activity is also about to unfold. Both are equally unpleasant if you are in the midst of it. Those who can should, and usually also do, try their best to manoeuvre around it. That can prove a cumbersome but rewarding exercise.
One of my annual tasks as head of a shipping outfit in China, is to predict whether the Chinese will return from their holidays with greater demand for vessels than for cargo, or vice versa. In recent years, the reality has been that demand for cargo has been far greater than demand for ships. I doubt that will be any different after this New Year holiday. However, it may be the year where the supply-and-demand balance starts changing for the better.
2016 will be the Year of the Monkey, one of 12 Chinese Zodiac signs that each represent certain characteristics and traits. Astrology has not won me over as a tool to predict the future behaviour of people or markets. Nevertheless, it is more about what many people believe, or at least consider and observe. For that reason I find it interesting to assess how a shift in the Zodiac sign can potentially impact our markets.
We come from the Year of the Sheep, or Goat. According to Chinese astrology, the Goat promised to be a more favourable year compared to the previous Year of the Horse. Clearly the Goat did not deliver on that promise when considering the dry bulk markets.
2015 was also expected to be a year of stable economic growth, which it was. At least if observed with Chinese eyes. It was further predicted that innovations presented to us in 2015 would transform our lives similar to the inventions of the Internet or cell phones. At least to me, Uber and Airbnb are relevant points of reference in this context. I had not used either of the services prior to 2015. Uber has already changed my urban experience to the better. Hopefully these new services can inspire greater digital innovation and development also within our industry.
2015 promised to heighten attention to ecological issues and environmental protection but, then again, it was no surprise that a certain meeting would take
place in Paris. Although the outcome for shipping was for many surprising or disappointing, the climate has definitely come higher on the agenda in many shipping
Unforgettable for the wrong reasons
We were told that 2015 would unfold several unforgettable events. The dry bulk market did indeed witness unforgettable events in 2015. Unfortunately for many though, these moments proved unforgettable for the wrong reasons. As with any predictions, also Zodiac astrology is presented without guarantee.
The Year of the Monkey is said to be a good time to demonstrate curiosity and cleverness, not bad character traits to demonstrate when engaged with shipping. But be aware that Monkeys are also masters of practical jokes, so don’t take every opportunity at face value.
Monkeys are known for working quickly but they’ll frequently charge double for their services, it is said. This is worth keeping in mind when working out the next voyage calculation. If returns may double for those being fast on the trigger, I sense a more volatile market going forward. As monkeys prefer urban life to rural, we can at least expect further urbanisation in China during 2016. That is a positive driver for dry bulk demand, also for the Chinese economy.
Believing that being sick is a waste of a valuable day is hard to disagree with. Monkeys apparently very seldom feel ill. When monkeys do become ill though, such feelings are said to be the result of being nervous. We have been nervous for a long time, I figure. This nervousness may well explain the current state of the market. However, as there becomes less and less to be nervous about, 2016 may just as well prove to be the year where the Monkey starts to recover from illness.
After all, monkeys are known to show amazing creativity in their work.
Where curiosity killed the cat, creativity fosters ideas. Ideas are again the mother of change.
Happy New Year / Gong Xi Fa Cai!