A lack of demand for container shipping often serves as a bellwether for international trade, so...

A lack of demand for container shipping often serves as a bellwether for international trade, so bleak forecasts (I, II, III) from Maersk (AMKAF.PK), Frontline (FRO -13.8%) and Teekay Tankers (TNK -2.8%) do not bode well for a global economic recovery this year. For the shippers, demand rising at about half the rate that new vessels are adding to capacity means a rough year ahead.
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Comments (3)
  • Herr Hansa
    , contributor
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    Some regions are experiencing lower export demand due to slowing economic recovery. If we get an uptick in economic activity and demand, then shipping activity will increase. I would expect the next few months to be rough, with some rate recovery heading into early 2014.
    22 Feb 2013, 05:39 PM Reply Like
  • oiltanking
    , contributor
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    There are more tankers and ships than ever so any global economic rebound, unless significant, is not going to have much effect. For that reason I do not necessarily agree with shipping being the indicator as to global economic health. The ship owners cannot resist the bargain basement prices of new builds, so they keep adding more vessels instead of pairing it with the scrapping of older ones in order to maintain an equilibrium. I think we will see a few shippers go out of business this year as it becomes a bit of a race of the last man standing, who in the end will reap the rewards.
    24 Feb 2013, 09:16 AM Reply Like
  • Herr Hansa
    , contributor
    Comments (3134) | Send Message
    Shipping rates are not a good economic indicator, nor are bunker rates, nor are profits (or losses) at shipping companies. A few years ago the talking heads of the financial news were all over BDI as an indicator, but it never had good correlation to overall market activity. What is a good economic indicator is the actual movement of ships, though it is not something that can be charted, and it requires continual observation through ship tracking software, and some knowledge of shipping, in order to provide useful information. When stock markets went into severe decline in late 2008 into early 2009, ship traffic was substantially lower. Ship traffic has improved since that time, though shipping companies have not properly taken advantage of that. This is not a new phenomena in shipping.
    24 Feb 2013, 06:55 PM Reply Like
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