Optimism In The Multipurpose Sectors, will it last?

Drewry Maritime Research’s latest Annual Multipurpose Market Review & Forecast details the state of the multipurpose fleet, the demand for the cargo space on those vessels and the outlook for the market they trade in. Project carriers and heavy lift are covered in detail to reflect the anticipate growth in demand.

London, UK, 29th March 2011 - The multipurpose sector and in particular the project cargo arena, have experienced a prolonged emergence from the global recession due to the inherent time lag in much of the cargo demand for this sector. Things are now moving in a positive direction with effective demand for the multipurpose fleet expected to experience growth of 7% pa on average to 2015, a rate higher than that of the container and dry bulk sectors.

In recent weeks fear surrounding the embattled Beluga Group’s announcements have stirred concerns, but it is important to remember that this situation is one that is internal to that organisation rather than being a manifestation of trading conditions.

Susan Oatway Editor of the Drewry Multipurpose Report states, “The vessels that Beluga has contracted on a charter basis are likely to be released back into the market. But demand levels are such that these vessels will be sought after and are expected to be utilised by other operators”.

It is the aforementioned trading conditions that Drewry has carefully analysed in its Annual Multipurpose Report and herein lays the indicators for the sectors prosperity.

Competitive threat is the key issue for the multipurpose fleet with it being squeezed by container and dry bulk carriers. This situation is an on-going facet of the sector but Drewry has delved deeper into the competitive analysis to highlight the changing approach of market players.

Positive demand growth for dry bulk and containerships implies that MPV market share of these sectors should remain steady. The real competition is stemming from minor or neo-bulk and general project cargo markets, which is where MPV volumes are generated from.

Drewry has examined in some detail project cargo and the prospect for this driving an increase in demand. Projections suggest growth averaging at least 11% pa to 2015, but we must be mindful of sectors, for example container liners, who have already started to position themselves against project carriers. Maersk for instance have recently been marketing their doesn’t ‘fit in a standard box’ options.

Now let us consider the current vessel orderbook to understand the multipurpose carriers’ response to this adapted competition. Order levels have reached 28% of the current fleet, with a skew towards those with a greater lift capacity, indicating that carriers are looking to niche markets where they can offer specialised services based around the project cargo demand increases.

“Yes, competitive threat is a major concern for the multipurpose sector, but reacting in an innovative manner, which we can see happening already within the project cargo arena, is how carriers are going to capitalise on market conditions. Given the unfolding Japanese crisis there is yet to come a possible demand shift towards the very ships that constitute the multipurpose sector’’ stated Susan Oatway of Drewry Maritime Research.

For a comprehensive analysis of multipurpose shipping and a depth of intelligence unavailable from any other single source contact Drewry for a copy of our Annual Multipurpose Shipping Market Review & Forecast 2011.
 

Source: Drewry Maritime Research