PEAK PEEKING: Topless Might Impress at the Beach but Valley Viewing Also Has Rewards

Part 1 of a 2-part series

By Geoff Uttmark

Q. Why is spotting market tops in shipping a lot like living in Seattle?
A. You’re sure that majestic Mount Rainier is out there somewhere, but it’s so cloudy most of the time you can’t tell where it is, let alone how high it is.

Though there are notable exceptions, shipping is most often described as a derivative industry. Demand for marine transport is driven by the level of activity in industries that require it. By extension, shipbuilding is a derivative industry of shipping. More ships are ordered when demand for seaborne transport is high. That’s when freight rates are putting sufficient cash in the pockets of optimistic owners to enable them to renew and expand their fleets. Predictably, of course, hot shipping markets cool off. Freight rates fall, ordered ships become delivered ships, and depressed conditions become outright depressions. As a result, over-leveraged shipping companies restructure, if they are able, over-age tonnage goes to the breakers, and overall industry consolation is spelled “consolidation”.

This is only an excerpt of PEAK PEEKING: Topless Might Impress at the Beach but Valley Viewing Also Has Rewards

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