Shipping Research News

The cost of chartering a supertanker to load Middle Eastern crude oil for Asia has rebounded from a 19-month low in September, but industry sources expect output supply cuts, led by Saudi Arabia, to cap freight rates for the rest of the year.The world's benchmark very large crude carrier (VLCC) export route from the Middle East Gulf (MEG) to Japan, known as TD3, rose to W50.46 on Monday in the Worldscale measure of freight rates, LSEG data showed. It fell to W35.60 in September…

The new Orca Class heavy-lift vessels being built at China's Wuhu Shipyard for the Jumbo-SAL-Alliance will be propelled by SCHOTTEL ControllablePropellers (SCP).The four-bladed controllable pitch propellers type SCP 129 will feature an input power of up to 8,810 kW and a propeller diameter of six meters.Jumbo-SAL-Alliance is a commercial joint venture between German shipping company SAL Heavy Lift and Netherlands-based Jumbo Shipping. Their new Orca Class, which includes four firm and two optional vessels…

Sailing cargo ships are making a genuine comeback.Japanese bulk carrier MOL is operating a wind-assisted ship. American food giant Cargill is working with Olympic sailor Ben Ainslie to deploy WindWings on its routes. Swedish shipping company Wallenius is aiming for Oceanbird to cut emissions by up to 90%. The French start-up Zephyr & Borée has built the Canopée, which will transport parts of European Space Agency’s Ariane 6 rocket this year.I researched the decarbonisation of the shipping industry.

The Baltic Exchange's main sea freight index fell for a fourth straight session on Tuesday as weakness in Chinese steel consumption took a toll on capesize demand, while rates for other vessel segments also retreated.The overall index, which factors in rates for capesize, panamax and supramax shipping vessels, fell 65 points, or about 6%, to 1,017 points, a more than two-year low.The capesize index fell for the fourth consecutive session, shedding 74 points, or about 18%, to 337 points…

The Baltic Exchange's main sea freight index fell to a nearly two-week low on Tuesday as rates across its vessel segments declined.The overall index, which factors in rates for capesize, panamax and supramax shipping vessels, shed 53 points, or 2.5%, to 2,061 points, the lowest since July 14.The capesize index fell for the second straight session, losing 141 points, or 5.4%, to 2,455 points, a near two-week low.Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes such as iron ore and coal, were down $1,167 at $20,359."The biggest headache moving forward will li

The Dutch Research Council (NWO) has awarded a research grant to a consortium aiming to contribute to the transition to emissions-free inland waterway shipping.The PATH2ZERO (PAving THe way towards Zero-Emission and RObust inland shipping) project, led by Alex Kirichek, will see researchers, companies and social organizations start developing sustainable business models and action perspectives for partners in the inland navigation chain, such as skippers and shippers, to make use of.As part of the project…

Online valuation and data provider, VesselsValue, said Friday it had acquired the Norwegian shipping research and advisory company, ViaMar.ViaMar, based in Oslo, is becoming part of VesselsValue which has over 200 employees across eight offices worldwide in the UK, Singapore, Hong Kong, Shanghai, Seoul, and Manila.The Norwegian company provides market research and advisory services in shipping, energy and financial markets, and, according to VV, has particularly strong relationships with major banks…

There is  increasing pressure for shipowners to sharpen their environmental performance, driven by an IMO target to halve greenhouse gas emissions from shipping by 2050, regional regulations and market pull from charterers, banks and investors.“This represents a whole new ball game for the industry. Optimization of ship operations has traditionally been dictated by the efficiency of delivery around the globe that has typically meant being able to sail at full speed, thereby burning more fuel, to minimize costs for the charterer.

French container shipping giant  CMA CGM plans to sell selected port terminals, ships and other assets to raise roughly $2 billion to finance its acquisition of CEVA Logistics, according to Reuters.Chinese state-owned conglomerate China Merchants Port has entered into a Memorandum of Agreement (MOA) with CMA CGM to acquire interests in a portfolio of 10 terminals from the French container line and its affiliates via Terminal Link for a total consideration of $955 million.As part of the deal, China Merchants Port will buy as much as $468 million of convertible bonds issued by the joint venture, Terminal Link, and will loan as much as $500 million to CMA CGM.CMA CGM is also raising about $860 million from a ship sale and lease-back deal.

Lloyd's Register (LR), the technical and business services organization and a maritime classification society, said that it is is collaborating with COSCO Shipping LNG Investment, COSCO Shipping Heavy Industry, Jiangnan Shipyard, MARIC, SSSRI and CCS to develop 220k LNG carrier with Mark III containment system.LR has signed an agreement with COSCO Shipping LNG Investment (Shanghai) Co., COSCO Shipping Heavy Industry Co., Ltd, Jiangnan Shipyard (Group) Co., Ltd. (JN), Marine Design and Research Institute of China (MARIC), Shanghai Ship and Shipping Research Institute (SSSRI) and China Classification Society (CCS) to design and develop the first 220k LNG carrier with a GTT Mark III membrane containment system.The seven parties will use their expertise…

Sparks light up the night-shift at giant shipyards on Korea’s southeast coast, as welders and fitters at some of the world’s biggest marine engineers forge next-generation container ships, oil rigs and even ice-breaking tankers in a bid to clamber out of a global industry abyss. Sunk by drastic cuts in orders from customers hit by the 2008 financial crisis, South Korea’s shipping landscape has been littered with bankruptcies and billion-dollar losses. But some, like Busan’s DSME, are adding innovation to craftsmanship to tap new demand for nimbler ships and offshore energy platforms.

MidEast tanker rates fall to $22,000 a day, below breakeven; 52 VLCCs to be delivered this year, highest since 2011. Freight rates for very large crude carriers (VLCCs), which fell to four-month lows this week, face an uncertain direction next week as refinery maintenance and excess tonnage pressure rates even as owners resist moves by charterers to push rates lower, brokers said. Meanwhile, rates on routes from the Middle East and West Africa to China rose slightly this week after falling since Feb. 10. "I think there will be a shallow recovery over the next two-three weeks," said Ashok Sharma, managing director of BRS Baxi in Singapore.

Owners face difficulty raising rates due to discounted ships. Freight rates for very large crude carriers (VLCCs) are likely to remain under pressure next week as charterers drip-feed cargo in the face of surplus tonnage, shipbrokers said. "The market is going sideways. Owners are trying to lift rates but it is very difficult because there are a lot of discounted vessels available," a European supertanker broker said on Friday. These discounted ships include older vessels, tankers returning to service following dry docking and new deliveries from shipyards. Operators of these vessels accept cheaper rates so the ships can gain immediate employment.

China has been pressing ahead with its ‘One Belt, One Road’ (OBOR) initiative – comprised of the Silk Road Economic Belt and the 21st-century Maritime Silk Road (pictured) – which was launched in 2015. Alibra Shipping Research is taking a look on China's plans. The ambitious scheme will build pipelines, ports and roads in areas home to about 65% of the world’s population and will affect about 25% of all the goods and services the world moves. The OBOR initiative aims to generate foreign demand to keep China’s excess steel mills, cement plants and construction companies in business, and therefore preserve jobs at home. The hope is that China’s second wave of infrastructural built-out – this time…

Alibra Shipping Research Weekly Market Report takes a look on current market scene of bulk carriers. For a little while now, the story has been “Now’s a great time to buy bulk carriers, asset prices are low…” We’re cautious of following the herd mentality so we wondered: is that still the case or has the moment passed? On Monday, the Baltic Exchange assessed the price of a five-year-old, 74,000-dwt Panamax at $13.6m. This is quite a decline on 18 months ago, when the benchmark vessel was assessed at$20m in the first week of January 2015. But the value of the Baltic’s benchmark Panamax has been appreciating ever since hitting an all-time low of $11.14m on March 29 this year.

The prices of WTI and Brent crude briefly rose above $50/bbl during intraday trading on Thursday, the highest level seen since the end of July 2015, giving traders a brief moment of optimism, says a report from Alibra Shipping Research. But since then, prices have trended downwards. WTI currently hovers around the $48.92/bbl mark on NYMEX. Similarly, Brent is trading at around $48.91/bbl on ICE. Analysts expect a further correction in crude prices because supply remains so abundant. Iran’s oil exports are expected to rise a further 200,000 bbl to reach 2.2m bpd by the middle of this summer. Last Friday, rig counts in the US did not decline for the first time in 17 weeks, possibly indicating that America intends to ramp up oil production again.

The Baltic Exchange's main sea freight index, tracking rates for ships carrying dry bulk commodities, rose on Tuesday, helped by firmer rates for bigger vessels. The overall index, which factors in rates for capesize, panamax, supramax and handysize shipping vessels, rose 16 points or 3.4 percent to 487 points. While the index has jumped nearly 70 percent since touching its all time low of 290 points on Feb. 10, analysts said the recent recovery being noted in parts of dry bulk market has been primarily fed by seasonal market movements and cannot be relied upon to support the sector throughout the year. "The same level of support from charterers can't be expected during the whole course of the year…

Dry bulk asset values dropped sharply in November and have reached 16-year lows, partly driven by very weak sentiment over the near-term future for vessel earnings, according to the latest Dry Bulk Freight Forecaster from shipping research and consultancy firm Maritime Strategies International (MSI). However, despite a bearish forward view of dry bulk fundamentals, MSI is more positive than the freight futures market’s forward curve for Capesize and Supramax spot rates in Q2 next year. MSI predicts a closing of the gap between iron ore spot and futures prices over the next six months, driving a period of iron ore restocking in China during Q2 which will support the Capesize market…

"The container shipping industry is in the midst of an over-capacity crisis which will worsen next year," Neil Dekker, director of container shipping research at Drewry said in a note accompanying the release of its 2015 edition of the Container Market Annual Review and Forecast 2015/16. Drewry says it has now slashed its container shipping growth forecast for 2015 to just 2.2 percent, while the 1.6 million TEU of extra capacity that has been added this year is the equivalent of a growth rate of 7.7 percent. As a result, the firm says its Global Supply/Demand Index indicating the relative balance of vessel capacity and cargo demand in the market (where 100 equals equilibrium) has fallen to a reading of 91 in 2015, its lowest level since 2009.

Slowing global trade and a bloated orderbook of large vessel capacity mean that container shipping is set for another three years of overcapacity and financial pain, according to the latest Container Forecaster report published by global shipping consultancy Drewry. The recent slowdown in world trade has forced Drewry to halve its forecast for container shipping growth for this year to just 2.2 percent and revise down estimates for future years. Meanwhile, an additional 1.6 million teu of new capacity is being added to the fleet this year, equating to a growth rate of 7.7 percent.

Global shipping consultancy Drewry predicts the container ship industry will be "lucky to break even this year" as shipping rates slump due to catastrophic overcapacity. A toxic mixture of overcapacity, weak demand and aggressive commercial pricing is threatening liner shipping industry profitability for the rest of 2015. Drewry’s new view of the market revises its earlier forecast that carriers would collectively generate profits of up to $8 billion in 2015. Drewry now says that its revised view is that carriers “will be lucky to break even this year,” meaning some lines will be back in the red by year-end. Despite first quarter industry operating margins of 8%, cost savings through falling oil prices were passed onto shippers by carriers in the form of much lower freight rates.

A toxic mixture of overcapacity, weak demand and aggressive commercial pricing is threatening liner shipping industry profitability for the rest of 2015, according to the Container Forecaster report published by global shipping consultancy Drewry. Earlier this year Drewry forecast that container shipping carriers would collectively generate profits of up to $8 billion in 2015, but our revised view is that it will be lucky to break even this year. This means that some lines will be back in the red by the end of 2015.

Clarkson Capital Markets, the investment banking arm of shipping services group Clarkson PLC,  says it has enhanced its equity research coverage with the appointment of Omar Nokta as Managing Director of Shipping Research. Omar will be based in CCM's New York office. Omar brings significant sector experience and expertise to Clarkson Capital Markets. He joins CCM from Global Hunter Securities LLC where he was Senior Shipping Analyst. Prior to this he was Senior Research Analyst at Dahlman Rose, where he helped build the company into one of the leading shipping focussed investment banks, advancing its energy, commodities and metals and mining product offering.