DNB Market Report Says: 'Just Look at the Car Carriers'

Press Release
Wednesday, October 03, 2012

In its latest shipping sector report DNB Bank, focuses on how ship speed optimization has changed fundamental supply/demand balances.

The DNB Bank report expounds:

Speed optimisation has completely changed the fundamental supply/demand balances. Over the past year we have pointed out how high bunker prices and speed optimisation have completely changed the fundamental supply/demand balances in the shipping industry. We calculate that utilisation in commodity shipping (dry bulk, tankers, container), is relatively high – around 84% – when reflecting the reported reduced sailing speeds, but 15% lower at 69% when assuming full speed.

For those sceptical on our market views, just look at the car carriers. Our above- consensus rate forecasts are based on vessel speeds remaining low, although rising somewhat, even if rates increase, as long as the oil price stays relatively high. We are often met by those sceptical on our market view, who state that every increase in utilisation is met by higher speed, taking the wind out of every upswing in demand. Apart from pure mathematics and fluid mechanics, the answer to the sceptics is to look at the car carrier segment.

The largest operator WWASA saves in excess of US$100-million annually from having slowed average speed from 21 to 17 knots and would rather order new vessels and/or charter in tonnage at higher rates than speed up its fleet, since the cost savings are enormous. We believe that smaller than expected demand improvements can lift rates from current depressed levels and that the other segments will follow the car carriers.




 

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter April 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

ABS’ Wiernicki Addresses SUNY Maritime Grads

ABS Chairman, President and CEO Christopher J. Wiernicki addresses SUNY Maritime College graduates, awarded honorary Doctor of Science   Christopher J. Wiernicki,

Moody's Dings Hurtigruten's Outlook Due to Newbuilds

Moody's Investors Service, (Moody's) issued a press release affirming the B2 corporate family rating (CFR), B2-PD probability of default rating, and the B2 senior

ShipDC Launches with New Leader at the Helm

Ship Data Center Co., Ltd., a wholly owned subsidiary set up by ClassNK, has officially commenced operations of its big data center, ShipDC, from April 2016. Taking

Finance

Moody's Dings Hurtigruten's Outlook Due to Newbuilds

Moody's Investors Service, (Moody's) issued a press release affirming the B2 corporate family rating (CFR), B2-PD probability of default rating, and the B2 senior

NOL Posts Q1 Net Loss of $105 Mln

NOL Group reported a first quarter 2016 net loss after tax of $105 million. Core EBIT (Earnings before Interest, Taxes and Non-Recurring Items) for the period was a loss of $84 million,

US Aims to Recover El Faro VDR in Next Few Months

The U.S. National Transportation Safety Board hopes to recover the voyage data recorder from the cargo ship El Faro, which sank during a hurricane killing all 33 crew on board,

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Standards Offshore Oil Port Authority Salvage Ship Simulators Shipbuilding / Vessel Construction Sonar Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.0973 sec (10 req/sec)