The shipping industry could be in for a decade of surplus capacity, a leading research analyst has said.
Dr Martin Stopford, managing director of Clarskon Research Services, said at Moore Stephens’ Ship Operating Costs seminar this week, that according to forecasts, sea trade will grow by 32% between 2010 and 2020.
However, the vessel supply assumptions outlined by Stopford in his presentation showed that the world’s fleet would grow by 46% during the same period, resulting in a prolonged period of overcapacity.
He said that this decade would be one of controlling costs, rather than watching the revenue rolling in as before.
Stopford outlined three correlated themes for this decade – shipyard overcapacity, energy costs and the environment. Yard overcapacity will lead to cheaper vessels, a willingness to undertake more innovative projects, while lower vessel earnings will push the strategic focus towards cost control.
Higher energy costs will push bunker prices ever upward and as a result, cutting energy costs and shipping’s carbon footprint will involve a compromise and difficult choices being made, such as lower speeds, modified designs, multiple fuel systems (for example more use of LNG), which are all possible, Stopford said.