Global shipping markets seen to struggle for 2 more years

By MEERA BHATIA (Bloomberg)
January 25, 2012, 3:01pm

MANILA, Philippines — The container and tanker shipping markets will struggle for another two years amid a glut of crude vessels and slowing global economic growth, according to the head of RS Platou ASA, Norway’s biggest shipbroker.

“In crude tankers and container shipping it’s going to take 2013 to work through the oversupply, but then the upside could be good,” Peter Anker, chief executive officer at the Oslo-based broker said in a Jan. 16 interview at the company’s headquarters. “The tanker market is a dark sea and container shipping looks very unpromising.”

Orders for new ships will fall 10 percent this year as banks curb financing amid a global vessel glut that has weighed on prices, reduced demand, spurred cancellations and delays in construction, Deutsche Bank AG has said. Orders will plunge 44 percent for container ships and 11 percent for tankers, the German bank said in a Jan. 11 report.

The slump will probably lead to increased combinations in the industry, Anker said. “I expect to see a lot of consolidation and restructuring in shipping in general this year, especially in the tanker market, where the outlook is still very challenging,” he said.

Shipping billionaire John Fredriksen’s Frontline Ltd., the world’s biggest operator of the largest crude tankers, earlier this month completed a restructuring as it sold vessels, pared commitments for new ships and eliminated its bank debt to tackle a shipping market slump. Torm A/S, a Danish tanker and bulk shipping company, fell the most in seven weeks on Jan. 13 after Oslo-based Finansavisen reported that Nordea Bank AB had tried to find a buyer for the company.

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