Global shipowning body BIMCO has just published its predictions for the three main shipping sectors in 2017, and owners need to brace themselves for another tough year.
“The shipping industry has its work cut out going forward in 2017 as the International Monetary Fund (IMF) forecast the lowest level of global GDP growth since 2009. 2017 will see another year of die-hard competition, which now includes tankers,” the Denmark-based body said in its introduction.
“The full restoration of shipping markets will need several years of solid improvements to lift fleet utilisation rates,” the report maintained, hitting out at misguided government interventions into the sector.
For dry bulk, BIMCO says it is vital that 30m dwt of ships are scrapped this year as there is a serious influx of new tonnage coming in from Asian yards this year and next.
“This is not a tall order in theory, but the slowdown in scrapping seen since June 2016 causes alarm bells to ring,” BIMCO noted. BIMCO expects the supply-side to grow by around 1.6% in 2017, as compared to 2.2% last year.
Meanwhile, BIMCO expects the crude oil tanker segment to see a net fleet growth of around 3% in 2017, as compared to 6% last year. The supply side growth rate of the oil product tanker fleet is likely to be around 2.5%, far less than last year’s 6.1%.
“We foresee demolition of tanker capacity to reach a five-year high, but not enough to prevent the onset of a loss-making freight market,” BIMCO predicted.
Finally, BIMCO expects the container shipping segment to see a net fleet growth of around 3.1% in 2017 as compared to 1.1% last year.
“If the multiplier gets back to one, and the IMF forecast of 3.4% becomes reality, the market will neither improve or worsen in 2017,” BIMCO said of the box sector.