Maybulk remains cautious for 2017 amid volatile dry bulk market

TIN news:  Despite improving conditions in the industry, Malaysian Bulk Carriers Bhd (Maybulk) remains cautious on its outlook for the year as the index for the dry bulk remains very volatile.

Its CEO Kuok Khoon Kuan told reporters on Monday that there was still a lot of uncertainty in the market, such as the increase in newbuilding (newly-built ships) orders, which could worsen the oversupply of vessels in the market, as well as reduced scrapping.

“There are also the uncertainties and protectionism that could possibly arise out of new political developments, such as the new administration in the US.

“With all this uncertainties, we are reluctant to give too positive a picture for the year.

“We can say that things have improved, but the improvement could be derailed by these factors,” he said after the group’s AGM here.

Kuok also noted that the Baltic Dry Bulk Index (BDI) was very volatile.

The BDI, which measures overall demand for bulk carriers across different ship sizes as well as a variety of commodities transported on such vessels, has risen significantly over the past year.

After hitting an all-time low of 290 points back in February 2016, the key benchmark rallied to over 1,300 points in March 2017.

It is currently hovering at about 1,000 points, with demand for iron ore and coal from China remaining a major catalyst for the industry.

Maybulk is the country’s largest dry bulk ship owner controlled by tycoon Robert Kuok.