Multipurpose/heavy-lift shipping is coping relatively well during the pandemic thanks to robust cargo volumes in the wind energy[ds_preview] sector, says Justin Archard, co-founder and managing partner of One World Shipbrokers and former COO of SAL Heavy Lift. Meanwhile the case for fleet renewal gets more and more urgent, he warns.
The past year was quite a roller coaster for MPP/heavy lift shipping. What were the biggest surprises for you?
Justin Archard: The biggest surprise was that the MPP sector wasn’t hit as badly as we feared it would be. The pandemic brought its complications – especially early on – as it did across all sectors but where demand weakened because of business interruption caused by covid, it was more than made up for by the still growing volumes in the wind energy and renewables sector, the low bunker price and to a degree the strengthening container market which meant container operators got less interested in break bulk. Balance sheet repair in the last 2 years – following nearly 10 years of recession – has stabilised the industry somewhat, so when this pandemic came along the sector was able to show a stronger face. This was a test but the sector is coming through it pretty well.
What are the latest indications from the project cargo side? What’s the pulse of trade?
Archard: Wind, onshore and offshore, are the buzz words. Commitments to zero emission-economies by the developed world are accelerating the need for green energy and in the northern countries wind is the dominant power resource of choice. Shipping volumes are increasing and have reached the point where this single segment is materially affecting worldwide fleet supply and charter rates are moving up.
Petrochemical projects have largely fallen victim to the historically low oil price with delays or even cancellations widespread. There are early Å of recovery but the MPP sector will have to wait beyond 2021 for any consistent contribution by the oil and gas community.
What are the most urgent issues that must be addressed once the pandemic situation eases?
Archard: Although seemingly not urgent today fleet renewal will become more and more pressing in the medium term. The average age of the MPP world fleet has crept up as the sector has been fighting one headwind after another. The second-hand market is extremely limited, newbuilding orders are very low and capital is scarce. These are tricky problems.
What are your own goals as One World Shipbrokers for this year?
Archard: Well, first and foremost as we are a new company, we want to survive! Beyond that, we hope to grow and develop a reputation for reliable, honest, and knowledgeable consultancy that adds real value to our clients‘ business.
