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AllThingsVentured Profile picture
@AllVentured
May 4, 2022 • 5 tweets • 3 min read • Read on X
Scrolly
Updated global fleet age and replacement requirements courtesy of the latest Danish Ship Finance report.

We are going to be hearing a lot more about negative fleet growth in #tankers and #drybulk in the coming years. Strap in for higher rates 🚀
Shipbuilding capacity still decreasing. Many second tier yards are unable to build the modern designs and sizes required. 129 second tier yards that delivered a ship in 2021 *did not receive any new orders in 2021*. These yards will most likely cease to exist in coming years.
Drybulk fleet detail. Orderbook to fleet acutely low in small sizes.
Crude tankers:
Product tankers. By far the lowest orderbook at just 4% of fleet. Compare this to today's earnings of $40k per day and DSF calling for 19% demand growth between 2022 and 2023. Just WOW.

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More from @AllVentured

AllThingsVentured Profile picture
Nov 26
1/ 5 years ago I penned the first of a series of articles on my highest conviction pick $NMM correctly calling for an immediate double✅, and quickly followed it up with a call for an eventual 10x and stretch goal of a 30 bagger.

seekingalpha.com/article/439251…Image
2/ I have been an unwavering $NMM, Tanker and Capesize drybulk bull ever since through some incredible volatility and so many doubters and so much disdain for this company and industry. I still have every last share of my huge tranche of <$4 cost basis shares I bought late 2020. Image
3/ It is crazy that this has already been a 10 bagger for my initial pre merger $NMCI shares and I'm having a hard time finding a higher conviction pick for the coming years. At just .4x NAV and 3x 2026 earnings based on my model, there is a super clear path to a 10x from the $7.90 price Seeking Alpha pegged my first article at.
Read 10 tweets
AllThingsVentured Profile picture
Nov 25
1/ Although JPMs supply predictions are totally comical, there will be SIGNIFICANT supply growth in the Atlantic. This is huge for #tankers ton mile demand as all marginal Atlantic production must ship to Asia where the marginal barrel will be consumed.
2/ Only 42 of then global 105MMbpd of oil production is exported by sea. The rest is piped or consumed regionally. Although the 1MMbpd is only a 1% increase in global oil supply, its a 2.5%+ increase to seaborne traded volumes. Image
3/ And the 2.5% represents a much larger increase in shipping demand due to the distance the marginal barrels will travel vs current trade with most of the words seaborne crude traveling much shorter distances to Asia and Europe currently. Image
Read 7 tweets
AllThingsVentured Profile picture
Jul 5
1/ Last nail going into the coffin of supply side headline risk. After this OPEC will have successfully gotten the market to price 0 OPEC+ restraint by September. Now we get price discovery on what the market thinks they can actually deliver without a cap.
2/ I'll take the under on however many barrels the government energy agencies think Saudi has in reserve:

3/ I'll take the under on US production estimates in the NTM

Read 8 tweets
AllThingsVentured Profile picture
May 19
I remember in fall 2023 when the unemployment rate first spiked 40bps nearly triggering Sahm rule, delinquencies started to go parabolic, student loans were supposed to go into repayment (before 2 more years of Biden can kicking) someone said that equities couldn't go lower when EVERYONE was bearish. This turned out to be the correct take. Markets went higher -> wealth effect -> reflexive economic strength along with fiscal can kicking heroics by Yellen and the Biden Admin to get through the election.

At the time, I tried to imagine a scenario where everyone was bullish DESPITE an incredibly bearish backdrop and couldn't. But here we are.

Read the comments on any bearish data or bearish takes today. Lots of "markets only go up". No rationale other than technicals and markets usually go up.

Sure the soft data hasn't been a reliable indicator in recent years but the hard data is starting to roll but nobody cares because "markets go up". And nobody is looking forward - the headwinds to the hard data are massive and obvious.

The response to a confluence of bearish factors is always "Fiscal dominance" or "Trump will jawbone the market up" or "who cares chart says up". Nothing like price to drive sentiment.

I'm personally exhausted. I'm starting to be concerned that the degens might actually be right and we go straight to Zimbabwe without the global margin call step.

At the same time my own feelings tell me we might be near that moment where positioning is back offsides and we are due for a mean reversion.

Logic tells me to stay the course - The bearish case is far clearer than it was in 2022 or anytime since yet sentiment is the most dislocated from reality today. And although I have always thought we would get the global margin call before the Zimbabwe, the fact that the Fed is not cooperating gives me more conviction that the Fed will require things to get MUCH worse before taking action to enable the Zimbabwe regime to begin.

I can only hope that the regime shift from margin call to Zimbabwe will be obvious when all is said and done and I can nail the turn from net short to levered long. Probably naive to think I can nail the path but this feels like the juice is worth the squeeze. GLTA.
Absolutely insane.
Record buying on multiple tape bomb day with worst leading indicators since a handful of banks failed.
Read 12 tweets
AllThingsVentured Profile picture
Mar 21
Shipping cheat codes:

In a shipping bull market, you want to own big ships.

In a shipping bear market, don't own shipping.

In neither scenario should you own small tankers.
Large crude tankers fetch much higher rates and margins in a tight market and fall back to the same near breakeven levels in a bear market.

Hydrocarbon trades (regardless of clean/dirty) are super fungible over any time period more than the next couple months. If profits in one size get out of whack, the WILL be quickly cannibalized by other ship sizes into a more typical $/ton distribution.

Read 4 tweets
AllThingsVentured Profile picture
Mar 19
1/ FINALLY some good data on US port calls vs Chinese fleet proportion regarding the proposed Chinese ship fees.

🧵TLDR: Most shipping trades will easily find non-Chinese tonnage to call US ports to avoid the fees

h/t Omar/Jefferies the first reasonable take vs the hysterics Image
2/ Here are the ratios of non-Chinese fleet to US share of global trade to show how many times over US trade is covered for each segment by the non-Chinese fleet:

Drybulk - .5/.075 = 6.7x
LNG - .9/.2 = 4.5x
Boxships - .6/.15 = 4x
Tankers - .7/.18 = 3.9x
LPG - .85/.45 = 1.9x
3/ Thats not to say there won't be disruption and extra costs. THERE WILL BE. Just not nearly to the hysterical estimates I keep seeing from shipping analysts and the liner company CEOs talking their book and threatening huge reductions in port calls. Not going to happen.
Read 13 tweets

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