S&P Global Ratings believes that this year demand in the three main segments of the global shipping industry – dry bulk, tankers, and containers – will outstrip supply for the first time in several years. The lighter new vessel delivery schedule for 2018, compared with 2017, combined with the ratings agency’s expectation of sustained imports of commodities, and longer distances travelled, point to rising charter rates across the shipping industry this year–with the exception of the container segment, which it forecasts in a new shipping report will see flat rates or a slight dip.
S&P urged owners to refrain from ordering new ships in order to sustain a longer rate recovery.
“If owners refrain from aggressive ordering and supply tightens further, we could see momentum in charter rates continuing into 2019,” the report maintained.
S&P views liquefied natural gas (LNG) shipping and passenger ferries as the most attractive shipping segments with container and dry bulk shipping as the most risky, because of typically weak credit from charterers.
In dry bulk, S&P is predicting an average rate for capesize vessels of $17,000 per day this year and $12,000 for panamaxes, similar levels to what was achieved in the final quarter of last year.
The ratings agency is predicting a cyclical upturn for product tankers, thanks to the all time low delivery schedule this year. Crude tanker rates, on the other hand, will likely remain under pressure this year because of OPEC oil production restrictions and a spike in vessel orders in 2017, S&P predicted.
For container shipping, S&P was concerned at liners’ continued poor supply discipline with a wave of new orders likely leading to flat, or even slightly depressed rates for 2018.