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We are an independent shipbroker with an approach focused on expertise rather than scale.

Affinity Policy Comment 11 May 2020

It is too early to predict the scale of the economic damage wrought by Covid-19, but there are signs.…


Here in the UK, it is pretty much a case of ‘as you were’, following PM Boris Johnson’s Sunday evening speech. Construction and factory workers (who had returned to work weeks ago anyway) are now officially cleared to do so, while the general population are now free to leave their homes to exercise as frequently as they wish (again, there was never a ban on this in the first place). Nothing has changed.

But the cost of these measures will be unprecedented, according to the Bank of England. Assuming that the lockdown will be eased in May, the UK economy will shrink by 14 per cent through 2020. On Thursday last week, the BoE’s Monetary Policy Committee unanimously agreed to maintain interest rates at their current record low of 0.1 per cent, but were split on whether to increase quantitative easing (QE). Two of the nine members voted to increase QE from GBP 100 Bn to GBP 300 Bn.

It is now widely accepted that it will take time for the general population to return to their pre-virus habits; even once lockdown restrictions are lifted entirely, it will not be until midway through next year that the UK economy will return to its previous size, according to the BoE. Nevertheless, it still expects the economy to grow by 15 per cent in 2021. The economy is in a much better position than it was following the crash of 2008, with actions taken by the government, including the wage retention scheme, due much of the credit.

It remains to be seen whether the ‘herd immunity’ course of action would have done much for the UK economy. In Sweden, which has opted to follow this path, the economy is still expected to shrink by between 6 – 10 per cent this year. While shops and restaurants have continued to operate, Sweden’s manufacturing sector has been hit hard, not because of factory closures, but because of an inability to source key parts from suppliers in Europe. Consumer spending in Sweden has fallen, but not as sharply as in other European countries, while its GDP contracted in March by only 0.3 per cent, compared to the eurozone’s overall 3.8 per cent.


This has all, however, come at a greater cost of life. Can you put a price on life? I’m sure economists around the world will come up with numbers once this is all over.

But these contrasting scenarios do highlight the differing realities for each individual country. While in Asia, countries are beginning to reopen offices, shops and restaurants, in the West, this is at least a few weeks, if not months, away.

How impactful this global disconnect will be is difficult to say just yet. It could prove to be an obstacle for coordinated central bank intervention, while the eurozone will come under increased scrutiny once the dust begins to clear. But we have already seen the problems this disconnect poses to some extent, with Chinese suppliers struggling in the face of weakened demand from the West. Container trade has struggled as a result.

On the flipside, it could also open up arb opportunities in tanker trade. Refineries in Europe have reduced, and are continuing to reduce, operational capacity, both at a cost and knowing that it would take time to restore output to ‘normal’ levels. Meanwhile, in Asia, refineries have already begun to increase runs, particularly in China. If and when demand bounces back in the West, we may see more volumes sourced from the East.

While hopes for a V-shaped recovery are fading, they are not entirely dashed just yet. It remains unclear how the world’s major economies will emerge from this wreckage. There is plenty of talk of how “things will never be the same again”, but it is too early for such sentiment. As time goes on a clearer picture will emerge. All one can do is stay alert.

Affinity Research LLP

what we do

  • 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)20 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]yship.com
    +44(0)20 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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Our locations


  • Floor 44
    The Leadenhall Building
    122 Leadenhall Street
    London EC3A 8EE

    T +44 (0)203 142 0100

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    LONDON

    Dry Cargo LNG Research S & P Tankers Newbuilding Finance Valuations


    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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    SINGAPORE

    Dry Cargo LNG S & P Tankers


    72 Anson Road
    #13–03 Anson House
    Singapore
    079911

    T +65 6805 8760

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  • Suite 5, Level 1
    200 Toorak Road
    South Yarra
    VIC 3141
    Australia

    T +61 398 671 466

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    MELBOURNE

    Dry Cargo


    Suite 5, Level 1
    200 Toorak Road
    South Yarra
    VIC 3141
    Australia

    T +61 398 671 466

    View full office info


  • 8/38 Colin Street
    West Perth
    WA 6005
    Australia

    T +61 892 260 618

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    PERTH

    Dry Cargo


    8/38 Colin Street
    West Perth
    WA 6005
    Australia

    T +61 892 260 618

    View full office info


  • 1st Floor
    64 Alexander Street
    Crows Nest, NSW 2065
    Australia

    T +61 299 378 800

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    SYDNEY

    Dry Cargo


    1st Floor
    64 Alexander Street
    Crows Nest, NSW 2065
    Australia

    T +61 299 378 800

    View full office info


  • #703, Shin-A Building
    50 Seosomun-ro 11gil
    Jung-gu, Seoul
    South Korea
    100-752

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    SEOUL

    LNG Newbuilding S & P


    #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

    T +852 2154 2237

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    HONG KONG

    Tankers


    6/F Kimberley Plaza
    45-47 Kimberley Road
    Tsim Sha Tsui. Kowloon
    Hong Kong

    T +852 2154 2237

    View full office info


  • 1301 McKinney Street
    Suite 2975
    Houston, Texas
    77010, USA

    T +1 832 925 7500

    View full office info

    HOUSTON

    Tankers


    1301 McKinney Street
    Suite 2975
    Houston, Texas
    77010, USA

    T +1 832 925 7500

    View full office info


  • Marco Polo Parkside Building 1204,
    Anli Road No. 80,
    Chaoyang District,
    Beijing, China, 100101

    View full office info

    BEIJING

    LNG Tankers


    Marco Polo Parkside Building 1204,
    Anli Road No. 80,
    Chaoyang District,
    Beijing, China, 100101

    View full office info


  • Jirón Cruz del Sur 140, of. 1712,
    Santiago de Surco, Lima,
    Perú

    View full office info

    LIMA

    Dry Cargo


    Jirón Cruz del Sur 140, of. 1712,
    Santiago de Surco, Lima,
    Perú

    View full office info


  • Augusto Leguia Norte 100
    Office 710
    Las Condes
    7550155 Santiago
    Chile

    T +56 22 352 7100

    View full office info

    SANTIAGO

    Dry Cargo


    Augusto Leguia Norte 100
    Office 710
    Las Condes
    7550155 Santiago
    Chile

    T +56 22 352 7100

    View full office info


  • Misiones St. 1372,
    1st Floor "De Los Patricios" Building,
    11000 Montevideo, Uruguay

    View full office info

    MONTEVIDEO

    Dry Cargo


    Misiones St. 1372,
    1st Floor "De Los Patricios" Building,
    11000 Montevideo, Uruguay

    View full office info


  • Viamonte 174, 4to B,
    C1053ABD Buenos Aires,
    Argentina

    View full office info

    BUENOS AIRES

    Dry Cargo


    Viamonte 174, 4to B,
    C1053ABD Buenos Aires,
    Argentina

    View full office info


  • Inkognitogaten 35,
    0256 Oslo
    Norway

    View full office info

    OSLO

    Offshore


    Inkognitogaten 35,
    0256 Oslo
    Norway

    View full office info