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By Walter Kurtz, Sober Look

Some dry-bulk ship operators now work just to cover fuel and keep their ships operational.

Bloomberg: D/S Norden A/S Europe’s biggest publicly trading commodity shipping company, hired a Supramax vessel at no cost other than fuel charges, its first such transaction in a quarter century.

But now the situation is so bad that a shipping firm is actually paying its client to keep the ship going.

Source: kapitall.com

Bloomberg: Glencore chartered the vessel, operated by Global MaritimeInvestments Ltd., a Cyprus-based company with offices in London,at minus $2,000 a day for the first 60 days of the charter,Steve Rodley, GMI’s U.K. managing director, said by phone today.The shipment is Australian grains to Europe and it will put theship in a better position for its next cargo, he said.

“Our other option was to stay in the Pacific and earn poorrevenues or ballast to the Atlantic and pay the fuelourselves,” Rodley said. Ballasting refers to sailing without acargo.

The overcapacity in the shipping business is out of control. If fuel prices increase further, we should see consolidation and defaults in that sector.

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