Greater China

Bearish sentiment hangs over dry bulk

Hong Kong: A palpable, grim sense of foreboding hung over the annual SinoShip Dry Bulk Business Breakfast this morning with predictions of a very protracted downturn. More than 40 people, including 18 shipowners, came to the top floor of the Foreign Correspondents’ Club in Hong Kong to hear and debate key issues affecting dry bulk. The event was sponsored by DVB Bank and Rightship.

Clarkson’s Dr Martin Stopford warned that dry bulk was unlikely to show much improvement for the rest of this decade. He chastised owners for ordering too many ships last year. Kenneth Koo, chairman of local shipowner Tai Chong Cheang Steamship, agreed saying, “Shipping is not going anywhere.” DVB analyst Abhishek Mittal was equally cautious and stressed that any disruption in China could have very serious consequences for dry bulk. And talking of supply chain disruptions, Rightship’s Warwick Norman said any strike at Port Hedland in Australia, as has been mooted for the past 10 days, could create further headaches.

With shipping in the doldrums for what is expected to be a long time, the industry must look to be more efficient and to invest far more on the technical side, Stopford said, suggesting shipping was a very long way behind its aviation and automotive cousins when it comes to research and development. Univan Ship Management’s Bjorn Hojgaard concurred and said now was the time for shipmanagers to invest in research and development too.

Oak Maritime’s Jack Hsu, meanwhile, pointing towards a recent discussion carried on Maritime CEO, said the disconnect between shipping and the actual ships themselves continues. [19/11/14]

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