Star Bulk Carriers 2Q17 Earnings Call Notes

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Petros Pappas

Generally positive about the market

” We’re generally positive about the market from the second half 2017 onwards and we believe that every subsequent year will fare better than the year before. This however is a fragile balance, which may tilt against us if ship owners embark in massive newbuilding ordering. We therefore highlight once again that the most important factor for market balance is owners newbuilding ordering discipline, in order to ensure a sustainable recovery as environmental regulations gradually come in to force. This environmental regulations will thereafter not only contribute to a transition towards a cleaner environment, but it will also assist shipping in reducing vessel supply and will therefore lead us to better markets as of 2020 onwards.”

Not concerned about Iron Ore stockpiles in China

“I think that the present stock is about the 142 million tons. Now, if you think that China consumes 1.6 billion, perhaps even more than that – billion tons of iron ore every year that is about a 140 million tons per month. Therefore 140 million tons of stock is one months’ worth. Now, I don’t think they would go below 70, so even if they decided to draw on their stocks that would be 15 days’ worth. I’m not saying this wouldn’t affect the market. This would probably temporarily affect the market, but it is not really such a great amount to be extremely worried about. I do not rule out that at some point that potentially iron ore prices go very high, they might temporarily draw on those stocks and that would have a transient effect on the market, but I do not consider this as a huge amount of stocks that would do permanent damage to the market.”