This fireside chat recap is from Day 1 of FreightWaves’ Global Supply Chain Week.
FIRESIDE CHAT TOPIC: The sea trade game is Genco’s home.
DETAILS: Genco Shipping’s John Wobensmith and Ocean Audit’s Steve Ferreira survey how companies are using new strategies to ensure they have inventory when they need it.
SPEAKERS: Wobensmith is president and CEO of Genco Shipping and Trading. Ferreira is CEO of Ocean Audit.
BIO: Genco Shipping and Trading (NYSE: GNK) is a logistics provider of oceangoing vessels serving customers in the iron ore, coal and grain markets. Ferreira founded Ocean Audit, a company that focuses on auditing the ocean freight supply chain to discover invoice errors, in 1994.
Watch: Steve Ferreira and John Wobensmith discuss dry bulk shipping industry strategy and opportunities.
KEY QUOTES FROM WOBENSMITH
“We typically see a seasonal weakness in steel production in the first quarter. You typically have a rainy season in Brazil, production of iron ore slows down in Brazil during the first quarter. It is also typically cold in China. The construction season naturally slows down in China during the first quarter. I would say this year is maybe a little amplified because of the timing of Chinese New Year, but then also the Olympics. We fully expect that steel production will continue to recover from the beginning of the year as we get past the Olympics.”
“We are at a historical low in terms of the percentage of the fleet that is on order today. It’s a little less than 7%. We haven’t seen numbers like this ever really. What that means is you have a very predictable supply side or numbers of ships that are coming on over the next couple of years. You’re only talking maybe 2% net fleet growth per year. You just don’t need a lot of demand growth to continue to surpass that and build on what we saw in 2021, which was obviously a very good year.”
KEY QUOTES FROM FERREIRA
“The real story is how steel and iron gets to China to make the refrigerators, to make the dishwashers, to make the TV wall mounts. Containers are only 16% of the global trade market and dry bulk is 45%. It’s not about containers anymore.”
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