INCREASED competition from container shipping and a slowdown in the project cargo market with volumes estimated to have dropped last year by 15 per cent has lead to demand for general cargo falling 30 per cent, according to research by Drewry.
"We continue to be concerned about competition from container lines, particularly for the project carriers. Any delay in the recovery of that sector will also delay recovery in this one," said senior consultant Susan Oatway.
But Drewry said the outlook for the sector is picking up after a poor year in 2013, forecasting that "demand for the multipurpose shipping will grow at an average annual rate of five per cent over the coming years.
"We are only expecting modest growth in 2014, as competition from other shipping sectors will continue to eat away at market share. But we expect the sector's market share to recover through 2015/16," the analysts were cited as saying in a report by the American Shipper.
Commodities such as forest products and steel are sometimes carried in shipping containers and box ships also compete for oversize breakbulk cargo by using special equipment, including flat racks and open-top containers. Multipurpose ships carry some containers in addition to breakbulk.
"The multipurpose vessel orderbook is very manageable and as long as newbuildings have a unique quality - whether that is eco-friendly engines or extraordinary lift capacity - there is still space to accommodate them," Ms Oatway said.
"This means that Drewry's forecast does provide some room for optimism for owners. Demand is expected to continue to grow and has the potential to deliver significantly increased volumes."
Drewry noted that cargo demand has risen steadily since the crash of 2009, but that the "multipurpose sector share of those volumes has eroded" and that "2013 was in fact a worse year for ship owners than recession-blighted 2009, as its market share dropped to just eight per cent of dry cargo, although tonnage was actually higher."
It said the biggest growth in last year's volumes came from cargo, such as steel and forest products. Global steel production exceeded 1.6 billion tonnes, with growth of five per cent compared to 2012.
"Whilst some major exporters (South Korea, EU, US) reported decreased exports over 2012, China and Taiwan continued to show strong growth (18 per cent and nine per cent, respectively), which contributed to an expansion in overall global traffic."
WORLD SHIPPING
10 April 2014 - 04:55
2013 project cargo demand falls 15pc to box shipping, outlook brighter
INCREASED competition from container shipping and a slowdown in the project cargo market with volumes estimated to have dropped last year by 15 per cent has lead to demand for general cargo falling 30 per cent
WORLD SHIPPING
10 April 2014 - 04:55
2013 project cargo demand falls 15pc to box shipping, outlook brighter
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