Shipping and martime industry face bad times.

[GoFlyKiteNow]

Shipping and maritime industry face bad times.

BBC reports that over 12,000 orders for ships and sea vessels
ordered with global shipyards have been canceled this year.

The shipping industry is really in a bad shape. Overcapacity
is so much that owners have started to scrap vessels
rather than pay for the maintenance of their idle ships.

The scrap industry has got a boost. But then again it is
at the expense of new steel production plants who
find much cheaper steel derived from scrap iron are flooding
the already dampened market for steel in the construction and
manufacturing industry.

The shipping and maritime industry is in for a real severe squeeze
for a few years. Ship yards from Brazil to China are closing down
production bays as the industry face a bleak future.

Over 200 supertankers are lying in the gulf of Mexico, being
used as temp storage tanks for oil.

It is a grim situation.
.

 

[Cestbon]

Re: Shipping and maritime industry face bad times.

Many reason for shipping down
1. Low demand due to economy
2. More efficient ship, Biggership can hole more cargo and higher speed reduce shipping/travel time
3. Smaller electronic parts also reduce the needed container

Future are bad for shipping industry. Many older fleet/ship will be likely sink/scrap will not able to compete with more efficient ship with bigger capacity, higher speed and more fuel efficient.

 

[Ah Guan]

Re: Shipping and maritime industry face bad times.

 

[zuoom]

Re: Shipping and maritime industry face bad times.

is it really that bad?

shipping rates are holding relatively steady nowadays. if too much capacity they would had drop the rates i remember during last year late 08 n early 09.

 

[KennyMGM]

Re: Shipping and maritime industry face bad times.

is it really that bad?

shipping rates are holding relatively steady nowadays. if too much capacity they would had drop the rates i remember during last year late 08 n early 09.

The situation is really scary. In Dubai offshore there are hundreds of big ships lying idle.
No cargo or container business.
Even oil rig industry is shrinking. Many scale down and some even plan to close.
Ports look like ghost towns in Saudi and Dubai areas.

 

[scoobyhoo]

the shipping companies are making huge profits by increasing their so call fuel-adjustment-factor, currency-adjustment-factors and increase their shipping charges etc. those eventually suffer are the normal people at the bottom of the society.

 

[GoFlyKiteNow]

the shipping companies are making huge profits by increasing their so call fuel-adjustment-factor, currency-adjustment-factors and increase their shipping charges etc. those eventually suffer are the normal people at the bottom of the society.

Not really. They have been having huge losses last 1 year and
the profits they make now from adjustment fees, can hardly
cover their massive losses.

Even when the ship is lying idle, it loses lot of money
by way of maintenance and depreciation and insurance
charges.

 

[longbow]

This is typical problem in ship building industry.

You are looking at capital intensive long gestation investment - making a ship - and trying to match that with economic situations which is cyclical.

 

[Watchman]

There need to be a war if this were to continue .

End of great magnate .

 

[GoFlyKiteNow]

This is typical problem in ship building industry.

You are looking at capital intensive long gestation investment - making a ship - and trying to match that with economic situations which is cyclical.

Early last year - one news report comment stands out for rememberance.

" Shipping companies are making their best profits in a 1000 years "
-
Hardly cyclical !

 

[zuoom]

that's during the commodities run. is it still running?