We are an independent shipbroker with an approach focused on expertise rather than scale.
Weathering the storm as we stare at Archimedes’ dollar smile
Why was no one taking the “risk free” profit?
Quantitative tightening, together with a contraction of credit in China and trade war-driven uncertainties in the past year-and-a-half, have caused business sentiment and growth projections to weaken. The Economic Policy Uncertainty Index has been very volatile recently, a lot more than usual. At the same time, global PMI has been falling, boosting demand for safe haven commodities, including US Treasuries, with global yields suffering. According to the USD smile theory, the US Dollar rises when uncertainty is high and the appetite for risk falls.
Uncertainties brought about by the trade war over recent months have put downward pressure on global GDP growth. However, support in the medium term can come from the global central banks that have switched from quantitative tightening to quantitative easing again, and rate cuts usually move with PMI over time. In addition, since the beginning of 2019, China has eased its credit condition and incentivised investments, with China's outstanding total social financing up 10.9 per cent year-over-year at the end of June.
The repo market spiked well above unsecured lending rates last week, even for US Treasuries in an environment with falling or negative interest rates. What happened last week with the financial system running out of cash revealed the high risk of a financial meltdown. The questions raised were: are US Treasuries really “risk free” given they are the most rehypothecated asset in the financial markets, and should the banks raise more equity capital? The US Treasuries market is like a game of musical chairs with not enough chairs for everyone once the music stops.
The recent turmoil in the repo market is a clear signal of a shortage in USD, which could aggravate the economic slowdown. The shortage of USD also caused Bitcoin to plunge in value, as the appetite for risk averse and less volatile assets surge. With a stronger USD, countries exposed to USD-denominated debt will be hit the hardest. However, the spike coincided with a time when many companies where submitting their quarterly federal tax payments and USD 78 Bn of treasury notes were settled.
Since mid-last week, the USD has softened but remained strong. Gold also dropped together with oil prices as supply side risk weakens. Attacks on Saudi and trade tensions drove the crude oil roller-coaster last week, while also providing support to tanker rates. Now, the anticipated regular Q4 tanker rate spike, geopolitical tensions, the trade war and IMO 2020 preparations will all make for a very interesting Q4...we can’t wait.
Affinity Research LLP
Dry Cargo
Dry Cargo
Our dry bulk chartering teams in Sydney, Melbourne, Perth, Santiago, Lima, Montevideo, Singapore and London are cargo-focussed and they fix voyage, COA and time charter business on behalf of their clients with a wide range of ship owners.
Contact: David Oakley
[email protected]
+61 2 9937 8806
Finance
Finance
Affinity Financial Products Ltd is authorised by the FCA to provide advice and execution of regulated activities. We focus our efforts on asset-related transactions often structured as corporate share sales or mergers and acquisitions.
We work in partnership with investment banks providing specific, shipping-related advice.
Contact: Andrew Finn
[email protected]
+44(0)20 3142 0114
LNG
LNG
Our young and dynamic LNG team possess wide-ranging experience of spot and term charters working with all major LNG shipowners and charterers. The LNG team has close interaction with the Newbuilding and Sale & Purchase divisions with an unrivalled track record of contracting LNG newbuildings and in the sale and purchase of LNG assets.
We maintain up-to-date knowledge and an understanding of new technologies within the LNG sector to ensure that our clients can make the most suitable and cost-effective decisions on shipping solutions.
Contact: Joni Mackay
[email protected]
+44(0)20 3142 0133
Newbuilding
Newbuilding
Our Newbuilding team has concluded over 500 newbuildings of all types, including LNGCs, FSRUs, drillships, crude tankers, product tankers and dry cargo vessels. We have contracted in all major newbuilding centres globally, with particular focus on the Korean Shipyards.
Contact: Nick Wood
[email protected]
+44(0)20 3142 0111
Offshore
Offshore
Affinity Offshore is based out of our Oslo and Houston offices. The Team focuses on world-wide sale & purchase of offshore support vessels, as well as chartering – particularly in the Americas and Mediterranean/MENA regions.
Contact: Tor-Øyvind Bjørkli
[email protected]
+47 2109 8211
Research
Research
Our research department combines real time market information with econometric modelling and the latest technology.
Contact: Sevita Kondyliou
[email protected]
+44(0) 3142 0182
S & P
S & P
Our Sale & Purchase team has extensive experience of working with private clients, national shipping companies, major corporates, oil companies, grain houses and institutional investors. We provide a cradle to grave services across all shipping sectors. We operate from London, Singapore and Seoul to give 24-hour coverage of the markets, working for both newbuilding and second-hand buyers.
Contact: Toby English
[email protected]
+44(0)20 3142 0123
Tankers
Tankers
Our established tanker chartering teams serve the industry from London, Houston and Santiago delivering a highly proficient spot chartering service with a prime position in the fuel oil market. The team has close relationships with oil majors, national oil companies, oil traders and major ship owners and operators.
Our ethos for operations and post-fixture is simple: these roles are as important to us as the chartering/commercial function, and we continue to apply those same principles of professional ship broking throughout the life of each fixture.
Contact: Tim Gurdon
[email protected]
+44(0)20 3142 0142
Valuations
Valuations
We provide transparent, objective ship valuation service to major owners, banks and other financial institutions at short notice and a daily basis. We provide a retainer service for regular fleet valuations.
Contact: Ben Pusey
[email protected]
+44(0)20 3142 0125
Dry Cargo
Our dry bulk chartering teams in Sydney, Melbourne, Perth, Santiago, Lima, Montevideo, Singapore and London are cargo-focussed and they fix voyage, COA and time charter business on behalf of their clients with a wide range of ship owners.
Contact: David Oakley
[email protected]
+61 2 9937 8806
Finance
Affinity Financial Products Ltd is authorised by the FCA to provide advice and execution of regulated activities. We focus our efforts on asset-related transactions often structured as corporate share sales or mergers and acquisitions.
We work in partnership with investment banks providing specific, shipping-related advice.
Contact: Andrew Finn
[email protected]
+44(0)20 3142 0114
LNG
Our young and dynamic LNG team possess wide-ranging experience of spot and term charters working with all major LNG shipowners and charterers. The LNG team has close interaction with the Newbuilding and Sale & Purchase divisions with an unrivalled track record of contracting LNG newbuildings and in the sale and purchase of LNG assets.
We maintain up-to-date knowledge and an understanding of new technologies within the LNG sector to ensure that our clients can make the most suitable and cost-effective decisions on shipping solutions.
Contact: Joni Mackay
[email protected]
+44(0)20 3142 0133
Newbuilding
Our Newbuilding team has concluded over 500 newbuildings of all types, including LNGCs, FSRUs, drillships, crude tankers, product tankers and dry cargo vessels. We have contracted in all major newbuilding centres globally, with particular focus on the Korean Shipyards.
Contact: Nick Wood
[email protected]
+44(0)20 3142 0111
Offshore
Affinity Offshore is based out of our Oslo and Houston offices. The Team focuses on world-wide sale & purchase of offshore support vessels, as well as chartering – particularly in the Americas and Mediterranean/MENA regions.
Contact: Tor-Øyvind Bjørkli
[email protected]
+47 2109 8211
Research
Our research department combines real time market information with econometric modelling and the latest technology.
Contact: Sevita Kondyliou
[email protected]
+44(0) 3142 0182
S & P
Our Sale & Purchase team has extensive experience of working with private clients, national shipping companies, major corporates, oil companies, grain houses and institutional investors. We provide a cradle to grave services across all shipping sectors. We operate from London, Singapore and Seoul to give 24-hour coverage of the markets, working for both newbuilding and second-hand buyers.
Contact: Toby English
[email protected]
+44(0)20 3142 0123
Tankers
Our established tanker chartering teams serve the industry from London, Houston and Santiago delivering a highly proficient spot chartering service with a prime position in the fuel oil market. The team has close relationships with oil majors, national oil companies, oil traders and major ship owners and operators.
Our ethos for operations and post-fixture is simple: these roles are as important to us as the chartering/commercial function, and we continue to apply those same principles of professional ship broking throughout the life of each fixture.
Contact: Tim Gurdon
[email protected]
+44(0)20 3142 0142
Valuations
We provide transparent, objective ship valuation service to major owners, banks and other financial institutions at short notice and a daily basis. We provide a retainer service for regular fleet valuations.
Contact: Ben Pusey
[email protected]
+44(0)20 3142 0125
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Floor 44
The Leadenhall Building
122 Leadenhall Street
London EC3A 8EE
T +44 (0)203 142 0100
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LONDON
Floor 44
The Leadenhall Building
122 Leadenhall Street
London EC3A 8EE
T +44 (0)203 142 0100
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72 Anson Road
#13–03 Anson House
Singapore
079911
T +65 6805 8760
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#13–03 Anson House
Singapore
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Melbourne
VIC 3004
Australia
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420 St Kilda Road
Melbourne
VIC 3004
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Australia
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Crows Nest, NSW 2065
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Crows Nest, NSW 2065
Australia
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#703, Shin-A Building
50 Seosomun-ro 11gil
Jung-gu, Seoul
South Korea
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SEOUL
#703, Shin-A Building
50 Seosomun-ro 11gil
Jung-gu, Seoul
South Korea
100-752
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6/F Kimberley Plaza
45-47 Kimberley Road
Tsim Sha Tsui. Kowloon
Hong Kong
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45-47 Kimberley Road
Tsim Sha Tsui. Kowloon
Hong Kong
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Suite 2975
Houston, Texas
77010, USA
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1301 McKinney Street
Suite 2975
Houston, Texas
77010, USA
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Marco Polo Parkside Building 1204,
Anli Road No. 80,
Chaoyang District,
Beijing, China, 100101
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BEIJING
Marco Polo Parkside Building 1204,
Anli Road No. 80,
Chaoyang District,
Beijing, China, 100101
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Av. Jorge Basadre 356,
San Idro, Lima
Peru
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LIMA
Av. Jorge Basadre 356,
San Idro, Lima
Peru
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Augusto Leguia Norte 100
Office 710
Las Condes
7550155 Santiago
Chile
T +56 22 352 7100
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SANTIAGO
Augusto Leguia Norte 100
Office 710
Las Condes
7550155 Santiago
Chile
T +56 22 352 7100
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Misiones St. 1372,
1st Floor "De Los Patricios" Building,
11000 Montevideo, Uruguay
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MONTEVIDEO
Misiones St. 1372,
1st Floor "De Los Patricios" Building,
11000 Montevideo, Uruguay
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Inkognitogaten 35,
0256 Oslo
Norway
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OSLO
Inkognitogaten 35,
0256 Oslo
Norway
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