Danish Ship Finance’s Shipping Market Review 2020

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Danish Ship Finance has released its latest shipping market review. The 69-slide presentation, led by Christopher Rex, has a strong focus on the industry’s pathway to zero carbon vessels, says an article of Splash247.

On the markets, the Danish analysts are especially bearish on next year’s prospects for tankers and LPG carriers, and remain concerned for the livelihoods of many of today’s struggling shipyards.

Facts in Report

Key data in the report include the facts that average secondhand prices declined 10% during the first ten months of 2020, but sale and purchase activity has been weak. The average newbuilding price declined 2% during the same period.

Discussing green stimulus measures being enacted across the world post-Covid-19, Danish Ship Finance analysts mused on stranded ship assets as well as the approaching peak seaborne trade volumes for many sectors.

The research house was most bearish on tanker prospects for next year, especially aframaxes, as well as LPG carriers.

Predictions from Report

“We expect their life expectancy to lengthen, as long as few new vessels are delivered and demand grows. If this situation persists into 2021 and beyond, many vessel segments may enter a period of higher freight rates and appreciating secondhand prices. If the situation proves long-lasting, existing vessels may begin to see their economic lifetimes approach their technical lifetimes and, in some segments, even exceed them,” Danish Ship Finance predicted.

The far fewer shipyards that survive in the next couple of years could be in a position to reap an ordering bonanza by the middle of this decade, Danish Ship Finance predicted as “extraordinary contracting activity” for dual-fuel and/or zero-carbon vessels ought to get underway.

Danish Ship Finance Statement

“These vessels may not be ordered at all yards, but the high-end yards that are price competitive could start to see the first signs of a boom in the making”.

“The short and medium-term outlook is bleak, since the combination of weak oil demand and high inventories implies little new demand for Crude Tankers, while further unwinding of floating storage will increase the available supply of Tankers.”

the Danish analysts took the global merchant fleet and compared it to leading conglomerates around the world, such as Apple and Saudi Aramco.

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Source: splash247

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