U.S. strike on Iran/potential impact on shipping:
“We’re closely monitoring the escalating tensions in the Middle East, which are already affecting global shipping.
While Seanergy is focused on large dry bulk vessels, not tankers, we frequently operate Capesize vessels inside the Arabian Gulf for iron ore trades, so we’re directly exposed to regional risks.
Disruptions in the Strait of Hormuz or Red Sea don’t just hit tankers, they spill over into costs, insurance, routing, and sentiment across all shipping sectors. Red Sea disruptions are already driving up delays and costs as ships reroute around Africa.
A partial closure of the Strait of Hormuz, now a higher risk after the Iranian parliamentary vote, would have a major impact on energy and infrastructure flows.
Even the threat alone could again spark shifts in trade patterns and push tanker rates sharply higher. We’re staying vigilant, prioritizing crew and vessel safety, and tracking developments closely.”
Israel/Iran conflict:
“We used to go through the Red Sea all the time, connecting Australia to Europe, for instance, and similar routes. Now, we must go around the Cape of Good Hope, which has significantly increased the ton-mile effect.
There’s also more pollution—because you’re covering more miles, you emit more CO₂, and it becomes more expensive for consumers due to the longer distance.
The shadow fleet has been operating since the Russian invasion, with numerous undocumented and unregulated ships moving around. There’s a real danger involved, and it’s a miracle that we haven’t seen more incidents caused by the shadow fleet.
Aside from insurance and related issues, whenever we see any conflict emerging, we don’t want to risk the health and safety of our crews, so we simply stay out of those areas. We’re fortunate to have partnered with some of the world’s biggest charterers. Whenever we tell them that we want to avoid war zones, they respect that and don’t pressure us to go through them.”
How things are going trade wise:
“While we faced some disruptions during COVID, lasting about a year to a year and a half, what we’re seeing now is a complex mix of geopolitics, wars, trade issues, tariffs, and sanctions that suddenly make our lives quite interesting.
We’re seeing trade disruptions, such as many owners and operators avoiding the Red Sea.
Uncertainty comes to mind as people are unsure of what kind of new trade restrictions might emerge. This doesn’t just regard potential tariffs and similar measures but also geopolitical issues.”
The most impactful change from now versus a year ago:
“The biggest, most impactful influence was the war. The first major event we saw was Russia’s invasion of Ukraine in 2022, which had a profound effect on global shipping. It disrupted many trade routes and introduced significant energy uncertainty.
Europe, for example, had been dependent on natural gas from Russia for about 50 to 60 years. Suddenly, it had to unlearn that dependency, moving away from what had been, if not free, then easily accessible gas flowing directly into the continent.
New routes had to be established because of sanctions, trade restrictions, and other consequences that came with the war. Then, we saw the Houthi activity in the Red Sea, where they began targeting ships, particularly those belonging to U.S. public companies, companies with U.S. interests, or anything they believed was connected to Israel. All these events unfolded simultaneously.
Then came the tariffs. While the full impact of these tariff threats hasn’t yet materialized, the fear of potential long-term trade disruptions, especially involving grains, steel, aluminum, and other fundamental raw materials and commodities, has added another layer of uncertainty.
Shipping is not for the faint of heart; you need a strong stomach to handle the geopolitical and international trade disruptions that arise from time to time.”
Where things are flowing now that the U.S. is trying to reshore its production:
“Imports in the U.S. have dropped significantly over the past few months due to the potential tariffs.
We need certainty as well as the need to ensure that trade can continue for the benefit of not only the U.S. consumer but everyone.
Suddenly, over the past few weeks, we’ve seen a surge in exports from the U.S. Gulf. There’s been a noticeable increase in corn products, maize, grains, etc., going to India and China. It had slowed down significantly before, but it’s picking up again now.
China’s reliance on U.S. grains has dropped significantly. They learned their lesson during the previous administration—not the most recent one, but the one before that. Now, they’ve become more dependent on South American crops.
I hope China returns to importing more grain products from the U.S., but it doesn’t seem likely in the near future.
We don’t believe that we’ve been affected because our trading routes primarily involve transporting iron ore, coal, and bauxite from production areas to the locations where they’re processed into steel and aluminum. So, we’re largely insulated from these issues.
The only cargo we move out of the U.S. is coal from the Baltimore area. In our smaller vessels, we transport some grains, but that’s insignificant compared to global trade and our core operations. The impact is more psychological than operational.
Instead of planning one or two years ahead for production, which involves hundreds of millions, or even billions, of tons, companies are now forced to think in short-term cycles, creating uncertainty.
We believe we are a vital part of the global infrastructure drive. There are hundreds of billions, and even trillions, of dollars being invested in infrastructure projects around the world, including in the Middle East, the United States, Africa, and Asia. We support these developments by transporting the raw materials needed to make them possible.
We haven’t seen a global slowdown or recession. Unless we reach a point where that kind of impact becomes real, then trade will continue. What has changed, however, is the outlook of stakeholders—their focus has shifted from long-term planning to short-term thinking.”
If there’s an increase/decrease in coal demand from China:
“We don’t see any significant slowdown in China’s coal imports. It’s important to keep in mind that China, India, and several other Asian countries are building many coal-fired power plants. They rely heavily on coal for their energy and electricity needs, and we don’t see that changing any time soon.
While renewables can replace some of that demand, the projected energy needs, especially with the rise of AI, data centers, and related technologies, are enormous. It’s hard to imagine meeting those demands without coal as a key energy source.
Renewables are beneficial, and when they work, they work well, but nothing can truly replace coal. After many years of efforts to transition to renewables, some of that momentum has, if not been reversed, at least slowed.
As an energy source, we expect to see a resurgence of coal, particularly from China, India, and the U.S., which will be positive for our trade.”
How tariffs are affecting the market for vessels:
“We don’t have anything against Chinese-built ships—in fact, we appreciate them and recognize the significant advancements China has made in shipbuilding. However, our fleet consists mostly of Japanese and Korean-built vessels, so we’re not affected, nor do we expect to be affected, by USTR actions or anything related to port usage or similar regulations.
We’re supportive of efforts to strengthen the U.S. maritime sector and would be glad to assist the U.S. government in finding a realistic path toward reviving the shipbuilding industry and supporting the U.S. flag fleet.
Regarding fleet management, we’ve focused on Capsize vessels because we work with some of the world’s largest miners and charterers.
In collaboration with these global partners, we develop solutions and ownership strategies that make our vessels more efficient, such as implementing energy-saving devices, advanced coatings, and other technologies.
These efforts help make our middle-aged ships more efficient, allowing us to reduce our carbon footprint through improved fuel efficiency.
Shipping cycles often result from a surge in new vessel orders. It’s usually a supply-driven issue. When too many ships are built, it leads to oversupply.
Unfortunately, we’ve seen periods where many players get caught up in a frenzy to build new vessels. While they may have their own valid reasons for doing so, we’re not in that position. We plan to continue operating our current mid-age fleet, along with the upgrades and improvements we’ve implemented. In some cases, these enhancements have reduced fuel consumption by 15 to 20%.
We might consider new buildings to renew the fleet, but for now, we’ll continue operating the vessels we currently have. We may buy a few more or sell some of the older ones, but this is a winning formula, and we don’t have any intention of changing it.”
Source: By Stamatis Tsantanis chairman and CEO of SHIP, USEA