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NOL

Today morning , sign of share buyout by short. There a feeling in the air, Us fiscal cliff might be over soon( just mine view).

In 2009, NOL making 150-200 mil loss every quarter and freight rate at ridiculous low rate but share price keep raising

due to improved sentimental view in US growth prospect. NOL trade at 1.2 to 1.4 P/B (1.4 - 1.8) in the 12 months of 2009.

Take note when US fiscal cliff is over, there might be big relief rally for NOL. NOL is a emotional stock everyone

punter/shortist luv it lol.

sgng123      ( Date: 06-Dec-2012 11:21) Posted: Share price moving in a see saw movement. Short seller short at alternative day and buy back at next. this week is like : Mon : buyback  Tue: Sell  Wed : Buyback  Today: sell. Don move in yet, wait for US fiscal cliff deal + BB involvement. No trading trend seen.

 

 

 

Share price moving in a see saw movement. Short seller short at alternative day and buy back at next.

this week is like : Mon : buyback  Tue: Sell  Wed : Buyback  Today: sell.

Don move in yet, wait for US fiscal cliff deal + BB involvement. No trading trend seen.

 

does it have any things to do with NOL business? they move steel as well?

davidscs      ( Date: 05-Dec-2012 13:41) Posted: US Steel Imports Dropped 2.5 Percent in October U.S. steel imports in October  were 2.54 million tons, dropping 2.5 percent from 2.60 million tons in September and falling 8.5 percent from 2.34 million tons in October 2011, according to preliminary government data covered by the American Institute for International Steel. In the first 10 months of 2012, imports were 28.23 million tons, increasing 16 percent from 24.33 million tons during the same period last year. Imports from NAFTA partners in October dropped even more significantly than the total, said David Phelps, president of AIIS. For example, imports from Canada and Mexico fell 4.1 percent and 10.0 percent, respectively, compared with September, he said.

 

 

http://www.joc.com/maritime-news/container-lines/g6-alliance/g6-alliance-suspend-some-sailings-early-2013_20121203.html

Take note carriers making similiar moves next year on europe route. Big GRI might be in the making in Feb-March period.

 

http://www.apl.com/india/html/news.html

APL implemented bunker charge on transpacific trade route effective 1 Jan 13

Appro US550 per 40 container. Anyone in shipping industries can verify it?

 

Nov economic data all distorted due to super storm sandy so don take much acount for it. Now is the US fiscal cliff, the

sooner it is over, the faster we can trade in time for CNY ang bao.. 2012 is just too similiar to 2009 it is like a mirror,

Just be alert for any BB movement, once they make their move then we make our. Trade with caution now until cliff is over.

Lot of broker house upgrade NOL to buy with TP 1.30 ~ 1.55. Nol might get another upgrade to TP after 4Q for sustained

profit, just take note 1Q13 nol building sale of 196M would be taken into 1Q profit, 1Q13 might be big but it like 6 months from now..

 

U.S. Manufacturing Unexpectedly Shrank as Orders Slowed 

 

shipping has been experiencing an extended prolong downturn . Think we may hv a yr end rally and shipping counters n commodity counters will have a good run up .

CSH123      ( Date: 03-Dec-2012 22:46) Posted: Possible for a 2007/2010 revisitation?

 

Possible for a 2007/2010 revisitation?

 

You are right, the cycle of the shipping is 2Q start to go up, 3Q in peak with surcharge for Christmas stocking  and 4Q and 1Q are quiet season.

But... 2012  was March jump up(1200) due to Maesrk hike rate, peak in May 2012(1500), fail to implement surcharge in July till Sept rate frustrating below May 2012 level(1200 to 1400), Oct 2012 drop below breakeven level (1200).

My understanding is Maersk and other container lines  idling vessels and  hike rate successfully in March. Successfully  rate hiking trigger  early  Christmas stocking in May and container lines recover idling vessels into market. July to Sept, surcharge rate fail to implement due to increasing capacity  from idling vessels and new vessel delivery. Oct to Dec, stepping to  quiet season, container lines start to idling  vessel again but  freight rate still dropping.

Accurate global data mentioned, 10% capacity of  new vessels are added but scrapping rate is lower than 2%.  The above condition will be worse in 2013.

Come on,  the  freight rate dropping reflect the  situation. Now is Dec, let's see if the surcharge can be implemented successfully or fail as usual  as from July till Nov. 

sgng123      ( Date: 03-Dec-2012 20:22) Posted: Come on lol. container shipping is a cyclical business meaning freight rate go up and down according to season factor. It start to move up in 1Q, peak in 3Q, fall in 4Q. Cannot expected SCFI to alway go up and up , it not a stock index. Nol business model is 12 monthly fixed rate, renew at Apr- May. Nov GRI still stick meaning enough supply had been taken out for now. Dec GRI should be able to stick due to 2013 CNY closure. Peak Season surcharge for US did not take place in 3Q, high chance it is delayed to 4Q 12 or 1Q 13 I did put a previous post indicating APL apply a PSS on dec15 on US route so high chance it is later dec to cny period. When SCFI go high, this do not meant NOL share go high ( 12 months fixed rate). whether nol can make profit depend on bunker fuel rate + cost saving + sentiment factor. Sentiment factor play a big part as BB would be looking into future economy before they plough it. US fiscal cliff overcome = NOL share recovering since we still got QE3 underway, lot of  printed money no where to go....

 

Come on lol. container shipping is a cyclical business meaning freight rate go up and down according to season factor.

It start to move up in 1Q, peak in 3Q, fall in 4Q. Cannot expected SCFI to alway go up and up , it not a stock index.

Nol business model is 12 monthly fixed rate, renew at Apr- May. Nov GRI still stick meaning enough supply had been taken out for now.

Dec GRI should be able to stick due to 2013 CNY closure. Peak Season surcharge for US did not take place in 3Q, high chance it is delayed to 4Q 12 or 1Q 13

I did put a previous post indicating APL apply a PSS on dec15 on US route so high chance it is later dec to cny period.

When SCFI go high, this do not meant NOL share go high ( 12 months fixed rate). whether nol can make profit depend on bunker fuel rate + cost saving + sentiment factor. Sentiment factor play a big part as BB would be looking into future economy before they plough it.

US fiscal cliff overcome = NOL share recovering since we still got QE3 underway, lot of  printed money no where to go.... 

 

If so simple, why  Shanghai container  freight rate index  drop from 1500 in May 2012 till 1082 last week?

The surcharge  for container freight rate was shouted since June 2012, but freight rate keep on dropping.

The vessels which are idled will still incur depreciation cost of vessel, crew salary, parking fee and etc. Due to  all these losses, once the freight rate is back to profit level, they will just pull all these idled vessels into market and pull down the freight rate. 2012 is a good example. 2013 which  will be the world record  year for  container vessels delivery, really no so positive to container shipping industry.

May consider to buy in after 2nd half 2013.  Now, just see see look look  how the overcapacity is going to affect NOL in 1H 2013. 

sgng123      ( Date: 03-Dec-2012 17:46) Posted: Shipping industry is not regulated so carriers can determine how many ships to deploy. If demand weak , just take out the ships and park them in open sea. Maersk, G6, etc had already removed like 20% of global capacity, if rate still not stable, they can take out another 10% or so. Basically carriers control freight rate market as they could adjust fleet to meet demand. The europe criss had lead banks to pull back finance for carriers, so carriers had to earn their money, no money to fight for market share = no rate war. Maersk even decided to  divert money to oil/port just prove that rate war is non existent in next 2-3 years. This don meant rate would going to shoot sky high, it just remain sustainable. It going to be a supply lead recovery not demand lead recovery. Carriers with a lower operating expense would earn higher profit while other just ok profit. Share price recovery for nol in 2013 highly due to 196M profit from nol building + successful cost saving implementation + stable bunker fuel. In fact 1Q 2013 might give biggest profit per quarter due to peak season surcharge + 196M nol building sale + full effect of cost saving. I know it crazy to assume this but the successful 4X GRI this year basically blow every analyst doom day senario for shipping to piece. 4X GRI jack up europe rate 1500 > 3800 ( 250% !!!) and US 1400> 2800 ( 200%!!). Carriers might repeat this year GRI in 2013, take care.

 

Shipping industry is not regulated so carriers can determine how many ships to deploy. If demand weak , just take out the ships and park them in open sea.

Maersk, G6, etc had already removed like 20% of global capacity, if rate still not stable, they can take out another 10% or so. Basically carriers control

freight rate market as they could adjust fleet to meet demand. The europe criss had lead banks to pull back finance for carriers, so carriers had to earn their

money, no money to fight for market share = no rate war. Maersk even decided to  divert money to oil/port just prove that rate war is non existent in next 2-3 years. This don meant rate would going to shoot sky high, it just remain sustainable. It going to be a supply lead recovery not demand lead recovery.

Carriers with a lower operating expense would earn higher profit while other just ok profit. Share price recovery for nol in 2013 highly due to 196M profit

from nol building + successful cost saving implementation + stable bunker fuel. In fact 1Q 2013 might give biggest profit per quarter due to peak season surcharge + 196M nol building sale + full effect of cost saving. I know it crazy to assume this but the successful 4X GRI this year basically blow every

analyst doom day senario for shipping to piece. 4X GRI jack up europe rate 1500 > 3800 ( 250% !!!) and US 1400> 2800 ( 200%!!). Carriers might repeat this year GRI in 2013, take care.

 

 

I don't think so.

The container vessel capacity will be added 10% globally in 2013. in Dec 2012, the idling rate of container vessel capacity is about 4 to 7%.

Unless the economic in 2013 can absorb 14 to 17% excess container capacity. Otherwise, container  shipping industry won't boom like 2004 to 2007 period.

sgng123      ( Date: 03-Dec-2012 14:44) Posted: As i mentioned in previous post, don need to put too much focus on freight rate 2 weeks from now it would jump  20%  then slowly dip and carriers would push out a few more GRI to make it stable. We are not in a global recession, now is great uncertainty in global market. When uncertainty removed, it gona be back to normal, oversold stock would be bought back and priced correctly. The best part i liked about now is US rate is very stable, it is like 1400 in dec 2011, now is like 2000 with GRI 400  coming on dec15.  Good US trade/economic data is like a simulant for nol share. Now is the waiting period, must endure till cliff is over. No trade on nol till at least year end.

 

As i mentioned in previous post, don need to put too much focus on freight rate 2 weeks from now it would jump  20%  then

slowly dip and carriers would push out a few more GRI to make it stable. We are not in a global recession, now is great uncertainty in global market. When uncertainty removed, it gona be back to normal, oversold stock would be bought back and priced correctly. The best part i liked about now is US rate

is very stable, it is like 1400 in dec 2011, now is like 2000 with GRI 400  coming on dec15.  Good US trade/economic data is like a simulant for nol share. Now is the waiting period, must endure till cliff is over. No trade on nol till at least year end.

 

Came across this good article from  Peter Tirschwell  , NOL CEO was also quoted-

“The great boom in container shipping was from one-time factors that will never come back,” Ng Yat Chung, CEO of NOL, told the TPM Asia conference.

  It’s well-known that global container volumes are slowing. But the impact this will have on the industry isn’t nearly as well understood, if only because a new era of slower growth is arguably just beginning.

Long-term slower growth isn’t simply a factor of the sluggish growth or recession in Europe and the U.S. since the financial crisis.

Rather, it’s a secular, likely irreversible trend driven by the reality that the industry’s marathon heyday — when volumes achieved cumulative annual growth of 7.9 percent between 1990 and 2012, according to Drewry — resulted essentially from one-time factors. The outsourcing of manufacturing from the U.S. and Europe mostly to China and the latter’s accession to the World Trade Organization in 2001 were critical. The indulgence in credit that spurred a final, unsustainable growth spurt leading up to the financial crisis followed.

In reality, container growth was declining even prior to 2000. As a factor of global GDP, container volumes grew 3.8 times GDP between 1974 and 1980 — a period that saw conversion of trade from general cargo to containers — 3 times GDP between 1981 and 1990 2.8 times between 1991 and 2000 and 2.5 times GDP between 2001 and 2010. Container volumes as a percent of GDP are forecast at just 2.2 percent from 2011-13, according to figures presented by Barclays analyst Jon Windham at the JOC TPM Asia conference in October.

This begs the question: Where will future sources of growth come from? Certain commodities, including identity-preserved crops and refrigerated goods, are shifting from bulk or breakbulk ships to containers, and some  air cargois shifting to ocean as shippers seek lower transportation costs. But all those are on the margin.

Another source of long-term, sustainable growth that intuitively one might think would support  prior growth rates is the developing world. According to Barclays, the world’s fastest-growing  trade lanes  for manufactured goods in 2011 and 2012 were, in this order, North Asia to South America, Middle East to Asia, South America to Asia, South Asia to the Middle East, and Europe to the CIS countries. Growth rates in each of those lanes exceeded 15 percent for the two-year period.

This  shift toward trade within the developing world  was reflected in a chart Windham showed the Shenzhen audience showing average distance traveled for Chinese exports growing 14 percent to nearly 6,000 miles between 2001 and 2006, peaking between 2007 and 2010 and falling 6 percent by 2014.  In other words, as trade within the developing grows, it often means shorter transits between countries that are closer to each other than Europe or North America is to Asia.   

“The great boom in container shipping was from one-time factors that will never come back,” Ng Yat Chung, CEO of NOL, told the TPM Asia conference.

The implications for  container lines  and their customers might be significant.

If the industry had trouble balancing supply and demand and achieving adequate levels of profitability in an era of predictably rising volumes, how will it accomplish this when volumes aren’t growing as fast? How will it resist the temptation to build ever-larger ships that yield lower per-slot costs but might not find enough cargo at profitable rates or be appropriate for smaller, faster-growing trades?

Will sources of capital wise up to diminished expectations and find other means to park their money? Can carriers curb their paranoia over losing market share and find a way to grow with the market? How can it work through its overcapacity and scale back ship ordering over the long term?

Until the carriers get this right, it will be more of the same for the industry — high volatility, low profits, general discontent.   

Peter Tirschwell is senior vice president of strategy at UBM Global Trade. 

 

  NOL may revisit low of sub $1. 

SCFI This Week: US West Coast Rates Drop 2.1 Percent 

Spot container rates from Shanghai to ports in North Europe, the Mediterranean, the U.S. West Coast and the U.S. East Coast all  lost ground this week, although at a slower rate than in recent weeks, according to the weekly Friday release of the Shanghai Container Freight Index.

Rates to North Europe fell 4.7 percent to $1,028 per TEU. Rates to North Europe have fallen for four consecutive weeks, dropping 31 percent from $1,491 per TEU during that period. All of the gains achieved in the Nov. 1 rate increase have now been eliminated.

Rates to the Mediterranean fell 5.1 percent to $746 per TEU, the fifth consecutive weekly decline. The Med rates have now lost 41 percent of their value since late October.

Rates to the U.S. West Coast dropped 2.1 percent to $2,046 per FEU. West Coast rates stood at $2,730 per FEU in late September, meaning they have dropped 25 percent since then. The weakness in West Coast rates prompted carriers in the Transpacific Stabilization Agreement to postpone a $400 per FEU increase to the West Coast from Dec. 1 to Dec. 15.

Rates to the U.S. East Coast dropped 1.5 percent to $3,099 per FEU. East Coast rates stood at $3,966 per FEU in mid-September, so they have lost 22 percent since then.

Rates from Shanghai to the Persian Gulf and Red Sea, meanwhile, surged from $626 to $863 per TEU this week, according to the SCFI index. The SCFI composite index gained 5.48 percent this week in part due to this increase.

“The fundamental question is, will carriers make any significant capacity adjustments? At present it appears not, at least not to the degree that is required to stop the rot,” ICAP said in a weekly commentary. “On the demand side of the equation cargo remains weak, the only option is a supply led recovery.”