The maritime industry is still affected by a tonnage overcapacity which has been a strain on many markets for years[ds_preview]. However, any development comes with greater or lesser opportunities depending on the perspective from which the situation is faced.
There is still a lot of movement in the shipping industry. As a leader among container lines Maersk Line has recently announced the best first quarter in the shipping line’s history. Despite 1.6% less transport volume an increase in profits by 57% to 714mill. $ was achieved. This is just one example. Another is the Brazilian mining group Vale, the world’s largest iron ore exporter with enormous significance for the bulker market – mainly due to the company’s own shipping business which is controversial because of its 400,000t vessels. The Group presented a quarter with record figures in the ore and nickel business.
Among others, these two players were in focus of recent speculation about an ambitious, significant fleet expansion. It’s about eleven 20,000 TEU vessels for the Danes or 50 Valemax bulkers. Although such reports have not been confirmed officially so far, there is no smoke without fire.
Now critics almost reflexively point out the negative consequences of major vessel newbuilding projects for the respective rates and markets and call it a »fatal mistake« by the purchaser. But from the perspective of a financially solvent buyer such orders actually make sense, as keywords for this rationale we may keep in mind low construction prices, the economies of scale or counter-cyclical investments.
Much has already been said about the thin line between individual entrepreneurial logic and the impact on the market and rates. The opinions often diverge – just depending on the perspective. What is certain is that the modernization of the world fleet, and accordingly the ever increasing importance of efficiency, environmental friendliness and digitization, has enormous opportunities for the big wide supply industry. The global new orders recently fell to the lowest level since the early 2000s.
At Nor-Shipping in Oslo numerous innovations and products will be on display again. »Green Shipping« and »digitalization« should be enough topics of conversation at one of the most important industry events. The supply industry relies on innovative capacity. In addition to retrofits the industry is also depending on a significant demand for newbuildings. It is this industry’s job to provide practical solutions also suitable on a large-scale and technical concepts for present challenges but also for the future.
Perhaps all players involved in the maritime industry will have to show endurance for a long time until the dust has settled sufficiently for the maritime industry. Nevertheless, there have to be players to lead the way – be it on the part of the shipowner or the supplier. Which newbuilding projects proof reasonable in the end and will be actually financed, the market often answers on its own.
Enjoy reading!
Michael Meyer
