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08 December 2021 The on-line newspaper devoted to the world of transports 02:13 GMT+1





And now three…

2005 IS THE THIRD CONSECUTIVE YEAR OF EXCEPTIONAL PROSPERITY FOR THE SHIPPING INDUSTRY, LEAVING A LASTING MARK ON A RESHAPED MARITIME ENVIRONMENT.

The shipping world has always been traditional and conservative, evolving slowly and carefully; it is true for progress and new technologies but is also applies to shipping capitalism.

For many years, the independence, and sometimes even the existence of sovereign States, was symbolised by national shipping and airline companies, often very wasteful and heavy-handed, for the greater part incapable of competing efficiently with the private sector. These national state companies therefore constituted the big names in shipping. Today they have given way to private groups which are far more dynamic, powerful and enterprising, to which the abundance of financial resources allows quick expansion.

With mergers, purchases and takeover bids having been particularly numerous this year, gigantic shipping companies were created controlling several hundred ships. Maersk, MSC, CMA CGM, Hapag-Lloyd etc. continued to progress in their amazing expansion in the containership sector. The oil tanker sector with Frontline, Worldwide-Bergesen, Teekay etc. also experienced major consolidation and expansion, while the dry bulk sector remained more fragmented.

This consolidation tendency has also affected the ports, where there was a fierce struggle between Dubai and Singapore to lay hands on the port and ferry arm of the UK firm P&O at giddy prices. At the same time, new private terminals, often co-owned by shipping operators, are being created within major ports.

More recently, this trend has hit the shipbuilding sector with the announced pur-chase of Chantiers de l’Atlantique by the Norwegian Aker Yards.

Traditional shipping bankers are also facing competition from private financial investors, which are extremely active in Germany and Scandinavia (through the KG and K/S schemes). The stock-markets themselves have come to find quoted owners, or those wishing to become so, more attractive.

Such consolidations are thus definitely modifying the shipping scene. These big shipping groups should lend a certain stability to the markets and a better balanced dialogue between owners and shippers, whilst throughout the entire chain of maritime service suppliers, including brokers, everyone is having to adapt to this irreversible evolution.

Our shipping world has taken over thirty years to absorb the tanker tonnage surplus arising out of the oil crises of 1973 and 1979 and then to absorb capacity surplus in the shipbuilding industry. After this long period of imbalance, with a market dominated by oversupply, there has been a sudden upswing in demand, with the existing fleet becoming unable to meet the demands of a rapidly expanding world trade.

Is this going to last?

By surveying the global orderbook (which has tripled in three years) and keeping past experiences in mind, it is not unreasonable to question whether or not we are again at the outset of a shipping crisis, which would arise as a result of an over-inflated fleet.

In the medium term, we do not believe this to be the case insofar as the continuing development of the two most populated countries in the world, China and India, will contribute by and large to the employment of these ships. Inevitably, we shall see some sizes or types of ships experiencing periods of imbalances, and thus suffering from insufficient rates, as has recently been the case.

Apart from its own cycles, a healthy shipping economy can only reflect a healthy world economy, and whilst this seems well established, it is nevertheless prone to adjustments and uncertainties. We should not, therefore, spoil the enjoyment of this revival, which looks durable and potentially long lasting, but we must remain wary of a world which is evolving faster and faster, though sometimes in unexpected directions

Shipping and Shipbuilding Markets in 2005

I N D E X



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