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Giant SMM survey reveals one in three owners are readying orders

Giant SMM survey reveals one in three owners are readying orders

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With 10 months to go until the world’s largest shipping exhibition reconvenes, the organisers of SMM have carried out a massive poll to gauge the state of the maritime industries. Shipowners should be aware of one of the key findings – around one in three owners are looking at ordering ships in the coming 12 months, something that could drastically change the slowly improving supply/demand equilibrium seen in most shipping sectors throughout 2017.

For the first time in its history, Hamburg Messe und Congress conducted a large-scale study asking SMM exhibitors and visitors to give their assessment of shipping’s economic and technological development. The SMM Maritime Industry Report was drawn from 2,500 participants from 69 countries.

For the first time a ‘Maritime Industry Score’ was computed based on the outcome of the survey. This score reflects the business expectations of shipowning companies, shipyards and suppliers.

In the wake of an economic lull that has lasted nine years in shipping, the results of the current survey show a certain “basic optimism” across the maritime sector, in spite of expectations of a continuing consolidation process, SMM said in a release. The overall Maritime Industry Score was 54.6 points, with the shipping segment’s 33.2 points clearly lagging behind shipbuilding (47.1 points) and the supply industry (61.9 points). These figures represent the ratio of positive versus negative growth expectations.

“The surprisingly positive outcome proves that the industry is beginning to see light at the end of the tunnel,” SMM said in the release.

Interestingly, among shipowners surveyed 20% consider it as ‘very likely’, and an additional 12% as ‘likely’ that they will order new ships within the next 12 months.

“This is especially surprising considering the fact that this value is far above the typical fleet rejuvenation rate,” commented Dr Max Johns, managing director of the German Shipowners Association VDR.

Expect LNG as a fuel to be a very prominent source of debate and on show at SMM, come next September. 44% of respondents said LNG is their first choice when contemplating ship newbuilding orders.

“There is no way around the energy transition in the maritime sector. The increasing number of newbuilding orders and retrofits shows that LNG is gaining ground. The future of low-emission shipping has long begun,” said Dr Reinhard Lüken, general manager at the German Naval Architecture and Ocean Engineering Association (VSM).

“I haven’t heard of any other study covering the industry in such breadth,” said Hauke Schlegel, managing director of the marine equipment and systems working group at the German engineering industry association VDMA.

SMM organisers plan to carry out the survey every two years.

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Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

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