Golden Ocean Sees 10% Growth
Reuters- Dry bulk carrier Golden Ocean Group Ltd expects double-digit growth in global iron ore trade in 2014, helping its markets pick up momentum and improving rates, the company's CEO Herman Billung said at a conference in Oslo on Wednesday.
The dry bulk and tanker markets have experienced a severe downturn in recent years due to global economic turmoil and a slew of new vessels, but Golden Ocean has already detected signs of recovery, driven by increasing Chinese and Indian demand for iron ore and coal, in combination with scrapping of older vessels.
Billung said he had had recent discussions in Singapore with major iron ore miners and one alone had indicated its shipping needs would rise to 100 cape-sized vessels, or ships that can carry some 160,000 tonnes of cargo, a month from 70 during the next 18 months.
"You can see it from what they are doing right now. They charter in vessels with a massive premium to the spot market", he said. "I think we definitely could see iron ore increasing by 10 percent in 2014. Coal I think will be a little bit less, around 6 to 7 percent."
Since peaking at around 40 crowns in October 2007, shares in Golden Ocean have been trading well below 8 crowns for several years, before starting to rise towards the end of 2013.
They were down 1 percent at 13.28 crowns by 1445 GMT, having scored the third-highest increase on the Oslo Bourse's main index during the last six months.
Major iron ore producers include Fortescue, BHP Billiton (BHPLF) and Rio Tinto (RTNTF).
(Reporting by Joachim Dagenborg; Editing by David Holmes)