Chennai: One Indian owner is adamant that he will practice what he preaches – not expanding as that’d be detrimental to the fragile state of the shipping markets.
C V Subba Rao, executive director of Chennai-based Sanmar Shipping, tells Maritime CEO: “Owners must refrain from fresh ordering as this could put pressure on freight rates and hull values.”
Sanmar Shipping is part of the 1994-founded Sanmar Group, which is a diverse conglomerate involved in chemicals, construction as well as transport.
Sanmar has a fleet of four tankers and two bulkers and no ships on order.
“The market continues to look a bit uncertain and shaky,” says Rao, “with no hint of a clear direction as to where it is heading. We would like to watch the trend, before we commit for anything further.”
Today’s market slump has more to do with overcapacity, Rao says, rather than availability of cargo volumes.
“Once the supply position eases, the freight rates should improve,” Rao maintains.
Sanmar has been traditionally cautious when it comes to ship investments.
He explains: “We believe that buying a ship at the right price and ensuring that the unit stays profitable over its life is more important than buying just for the sake of expansion, based on current data alone. We resisted the temptation to buy in the boom years of 2007-08; and we remain equally watchful today. This policy ensures that we keep our head above water.” [03/05/12]
NEED TO KNOW: Sanmar
The Sanmar Group is a conglomerate that has a presence in chemicals, shipping, engineering and metals. Founded in 1994 in Chennai Sanmar Shipping has six ships today, four tankers and two bulkers.
