Drewry Predicts Multipurpose Shipping Resurgence

MarineLink.com
Tuesday, March 26, 2013

The Multipurpose sector faces a difficult couple of years, but its long-term prospects are good, according to Drewry Maritime Research’s latest Annual Multipurpose Shipping Market Review and Forecast report.

Most owners of Multipurpose ships (MPVs) were fairly upbeat at the start of 2012 and, in spite of weak freight rates, continued to be so well into the first half of the year. However, over the course of the year the market softened further and by the year end most sectors had lost between 3 and 6% off their value for one-year period hire.

Susan Oatway, author of the Multipurpose report, explained, “Competition from the container sector becomes ever more aggressive in the face of their dire market conditions. We continue to see the lines marketing their vessels for project cargo and neo-bulks being stuffed in containers. And we think the situation will get worse before it gets better, however, we also believe there is a ceiling for this activity – and it is relatively low – with Drewry’s container analysts forecasting an improvement for this sector in the medium term.”

The other main competitor for MPV cargoes is the Handy bulk carrier – particularly Handysizes of 10-30,000 dwt – and they are experiencing something of a comeback. The fleet is well under control and minor bulk demand is growing steadily. As such, the outlook for this sector is very positive in terms of demand for the available vessels, which should keep those same vessels away from the MPV market. The steadily rising demand for minor bulks, plus the low growth in the Handy fleet, also means there should be more of this market available to the multipurpose fleet. Indeed, MPV volumes for this sector are expected to grow at around 7% a year up to 2017.

The final bit of the jigsaw is the market share of general and project cargo. At this level the MPV ship faces competition from Ro-Ro carriers (as well as containers). Market share in this sector has been relatively steady over recent years and, although expected to dip here too to 2014, should pick back up relatively quickly to the end of the forecast period. MPV volumes here are expected to grow at an average annual rate of about 3% over the forecasted period to 2017.

Drewry’s report states that MPV market share continued to rise over 2012 as non-containerised cargo volumes benefited from the rise in general cargo trade. While the total volume predicted to make up the demand for the MPV fleet is expected to rise over the period, during 2013 and 2014 this will be very flat. It is not until after 2014 that this sector can see any real improvement in demand.

Oatway adds, “Drewry’s forecast for this sector is still optimistic – for the longer term at least. The usual caveats all apply; principal among them is the global economy (another financial bubble would stop a lot of the EPC investment) and the expectations for demand. The number of new ships due to be delivered over the next few years is manageable with these demand levels, as long as owners do not decide that there is a greater need for new vessels. If shippers are honest, they must recognise that the current market conditions are not a tenable position for anyone. So if owners can weather the next two years, when competition for cargoes will remain fierce, and promote this fleet as the value-added alternative to containers, then there is a real chance that more positive results are in sight

www.drewry.co.uk

Maritime Reporter September 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Bulk Carrier Trends

Cargill: 50,000T of Sugar Affected by Brazil Fire

Approximately 50,000 tonnes of sugar were stored in a warehouse affected by fire in the Teag terminal in Brazil on Monday, Cargill Inc said in a statement. The terminal,

Simushir Under Tow by Barbara Foss

Foss Maritime's ocean-going tug, the Barbara Foss, is towing the Russian cargo vessel, Simushir, which lost power late Thursday night off the west coast of Haida Gwaii.

Vancouver Welcomes Bulker on Her Maiden Voyage

The Port of Vancouver USA welcomed the M/V Jobst Oldendorff, commanded by Capt. Baisie of Ghana, on her maiden voyage October 16. Capt. Baisie and his 21-member

Finance

Nordic American Offshore Declares Dividend

Nordic American Offshore Ltd. today announced that its board of directors has declared a dividend of $0.45 per common share for the third quarter 2014. This is the same as for the second quarter 2014.

Bollore Africa Logistics Sees Profit Plunge in H1

First half 2014 profit at shipping company Bollore Africa Logistics plunged to 5.89 billion CFA francs ($11.48 million) from 9.45 billion CFA francs in the same period last year,

Maduro Says Venezuela's 2015 Budget to Put Oil at $60

Venezuela's 2015 budget will be based on a target oil price of $60 dollars per barrel, President Nicolas Maduro said on Friday night, but he repeated expectations that prices will recover.

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Security Maritime Standards Naval Architecture Pipelines Ship Electronics Ship Simulators Sonar Winch
rss | archive | history | articles | privacy | terms and conditions | 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: 0.1509 sec (7 req/sec)