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Clipper Bulk downsizing to mitigate pandemic’s impact

April 23, 2020

Danish bulker operator Clipper Bulk A/S has launched cost-cutting efforts to combat historically low freight markets caused by the Covid-19 pandemic, which will include job cuts.

The company said it would axe 24 out of 91 jobs ashore by the end of April, with the majority impacting the head office in Copenhagen.

Clipper Bulk vessel
Illustration; Source: Wikimedia

“The dry cargo market has struggled with unsustainably low freight rates for years, but the Covid-19 pandemic has made matters worse and caused a steep downturn in demand and freight rates. We need to adapt to this new reality, and we are making these changes to stay ahead of the situation,” says Clipper Group CEO Peter Norborg.

Furthermore, in order to stay afloat, the dry bulk operator will keep its focus on its profitable niche operations.

These include Clipper Steel service to/from the US and the Mexican Gulf with the part-owned IPA Steel Terminal, Compass Rose – a joint-venture with a Colombian manufacturer of fertilizer- as well as China Parcel cargoes from more consignors into China, combined with back-hauls into the Atlantic, among others.

These are expected to fully cover Clipper Bulk’s cost base after the downsizing. Furthermore, Clipper Bulk will stay open to the spot market to serve its long-standing customers and partners.

Commenting on the integration of the newly acquired Bulkhandling Pool, the company said the process was unaffected by the organizational changes.

Namely, Clipper Bulk recently took over rights, trademarks, and key people in order to merge the Bulkhandling Pool with Clipper’s own Ultra Pool. Members are currently joining the new Clipper Bulkhandling Pool and vessels are planned to be transferred within the near future.

“The pool’s activities are unaffected, and we look forward to announce new pool members soon. We will have adequate capacity to handle significant growth in the pool’s activities,” says Norborg.

Clipper Bulk operates 65-85 vessels, including tonnage operated by the two Clipper Bulkmanaged pools: The Clipper Handy Pool (28-38,000 dwt vessels incl. fully fitted loggers and grabs-fitted vessels) and The Clipper Bulkhandling Pool (57-64,000 dwt, grabs-fitted vessels).

The post Clipper Bulk downsizing to mitigate pandemic’s impact appeared first on Offshore Energy.