BIMCO: Global Bulker Fleet to Be Cut by 30 Mln DWT in 2015

Devastating market conditions in the dry bulk shipping market are expected to send 30 million DWT for demolition from the global fleet during 2015, with 17 million DWT reported to have been sold for demolition at the end of May, BIMCO estimates.

“Owners have dug deep in the first five months of 2015 whilst continued devastating freight market keep demolition volumes high,” BIMCO said.

The Capesize fleet is smaller today than half a year ago (beginning of November). The development in Panamax and Handysize segment is flat, whereas the Handymax/Supramax segment has grown as was expected.

In spite of 1 million DWT of Handymax capacity being demolished, 6 million has been delivered, equal to a growth in supply for that sub-segment of 2.9% for the year to date, BIMCO’s data shows.

For the year 2015, BIMCO expects supply growth to be at 3.8%. This is a downward revision of its estimation three months ago resulting from adjustment of demolition volumes expected for 2015.

Another positive development is found on the contracting side. 35 new orders have been placed at global shipyards so far this year (1.8 mill. DWT). 7 Panamaxes, 12 Handymaxes, 16 Handysizes and no Capesizes have been added to the order book, which now stands at 1,750 ships with a combined capacity of 142 million DWT. Some 1,981 ships were contracted during 2013-2014.

In terms of outlook, BIMCO said that Indian coal imports may go up by 20 million tons, however; Chinese imports are expected to drop by 30 million tons for the second year running.

“Despite a very bad sentiment in the market, BIMCO expects volume to increase as we move into Q3. More Brazilian iron ore and grains (wheat and coarse) moving into the market as the soya season abates, should on an overall level, prohibit the market to go into reverse – if volumes contract.

“160 million DWT of new orders placed in 2013/14 can only do harm when demolition activity fails to slash any records by a never-seen-before margin. As the demand growth for dry bulk seaborne transportation seems to weaken too, potentially even on a permanent basis as China changes gear, the industry must adapt to become profitable again. Wait-and-see strategies may turn out to take too long,” BIMCO said.

The Council believes that in addition to cooling down of new orders for a while, owners must be sensitively counterbalanced with demolition for a number of years, not just a few quarters.

For the coming months: June-August, BIMCO expects the market challenges to stick.

“The demand side is so weak right now, with China reducing coal import by 40% that it dwarfs most of the positive aspects of the market. On the upside we see owners limiting fleet growth by increasing demolition of obsolete tonnage,” BIMCO concludes.

Share this article

Follow World Maritime News

In Depth>

Events>

<< Feb 2018 >>
MTWTFSS
29 30 31 1 2 3 4
5 6 7 8 9 10 11
12 13 14 15 16 17 18
19 20 21 22 23 24 25
26 27 28 1 2 3 4

Shipping 360

This course is ideal for those who have recently joined the maritime sector and those who need to have a better understanding…

read more >

APM – ASIA PACIFIC MARITIME 2018

27 years in the making, APM is the premier shipbuilding & marine, workboat and offshore exhibition in Asia trusted by generations of industry professionals.

read more >

Shippax Ferry Conference 2018

The two-day onboard ferry conference was first organized in 2003 and grows ever more popular with some 400 delegates from over 40 ferry…

read more >

8th Dredging & Land Reclamation World Summit 2018

The 8th Dredging and Land Reclamation Summit 2018 will gather the decision makers from Authorities and Operators responsible for ports…

read more >