HEAVY LIFT SHIPPING TRENDS
SUPPLY v DEMAND
Dry Bulk Indices 1985 – 2013 – Some historical
Perspective …
GFC
ORDER BOOM
Recent Project Experience (Ocean Transport) Daily Freight Index – July 2007 – Oct 2013
Shipping is a cyclical industry.
Newbuilding orders were made on the back of
a record breaking boom.
Downturn came with an unprecedented bang
in the wake of the GFC
Too much supply will always lead to
deterioration in rates.
Shipping is a commodity but specialist heavy
lift – especially at the higher end – requires
engineering and risk management – which
commands a premium.
History repeats itself…
H/L Liner Fleet at 2.12m dwt as@ Oct 2013
Min lifting capacity 300mt
Trend is increasing lifting cap from 300-500t in
late 90’s to 700-900t in 2010’s
DWT capacity also trending up
Owner Number of Units Total DWT Fleet (MT) Ave DWT per vsl (Mt)
Ave Combinable Lifting Capacity (MT) Ave age of vessel
BBC 48 538,062 11,210 463 4.7
Bockstiegel 31 420,378 13,561 554 2.7
HHL 24 400,399 16,683 878 3.2
Other 25 282,693 11,308 359 9.1
Big Lift 15 220,974 14,732 867 9.3
Peter Dohle 17 205,499 12,088 422 7.1
SAL 16 166,112 10,382 985 9.8
Thorco 13 149,437 11,495 346 7.1
Combi Lift 16 136,097 8,506 609 7.3
Jumbo 14 133,042 9,503 1,293 12.3
Intermarine 12 130,599 10,883 575 5.7
Nordana 7 86,256 12,322 414 0.0
SE Shipping 5 75,665 15,133 420 3.0
Hanssy 7 63,468 9,067 471 19.0
Desgagnes 4 50,845 12,711 315 4.0
Elmira 3 26,622 8,874 333 13.3
Heino Winter 2 25,564 12,782 240 8.0
Freese 2 25,488 12,744 240 7.0
Sloman Neptun 2 25,344 12,672 300 1.0
Hartman 6 23,800 3,967 260 2.5
PGM 3 22,901 7,634 400 13.0
Sloman Neptun 2 25,344 12,672 300 1.0
Atlanska Plovida 2 14760 7380 500 18.5
Heavy Lift Tramp Fleet
Owner Number of Units Total DWT Fleet (MT) Ave DWT per vsl (Mt) Ave Combinable Lifting Capacity (MT) Ave age of vessel
Jumbo 14 133042 9,503 1,293 12.29
SAL 16 166112 10,382 985 9.81
HHL 24 400399 16,683 878 3.17
Big Lift 15 220974 14,732 867 9.33
Combi Lift 16 136097 8,506 609 7.31
Intermarine 12 130599 10,883 575 5.67
Bockstiegel 31 420378 13,561 554 2.71
BBC 48 538062 11,210 463 4.67
Peter Dohle 17 205499 12,088 422 7.12
Owner Number of Units Total DWT Fleet (MT) Ave DWT per vsl (Mt) Ave Combinable Lifting Capacity (MT) Ave age of vessel
Jumbo* 14 133042 9,503 1,293 12.29
SAL 16 166112 10,382 985 9.81
HHL 24 400399 16,683 878 3.17
Big Lift 15 220974 14,732 867 9.33
Combi Lift 16 136097 8,506 609 7.31
Intermarine 12 130599 10,883 575 5.67
Bockstiegel 31 420378 13,561 554 2.71
BBC 48 538062 11,210 463 4.67
Peter Dohle 17 205499 12,088 422 7.12
Premier League of Heavy Lift Carriers
*Includes 2 x K3000 new buildings delivery 2014
Years >
Fleet renewal over past 5 years slowing.
Entry of Capital Fund Managers into shipping
markets.
Trend towards consolidation amongst carriers
driven by market downturn and need to
improve prospects.
Fewer Carriers will lead to greater control and
leverage of rates towards higher levels.
Market Trends
Global EPC Feed Projects – Energy & Power
Sector 2014 - 2017
Snapshot SE Asia 2014 – 2019 EPC + FEED Projects
ALE Heavy Lift, SE Asia Marine Business Strategy 2013
Source: EIC, Upstream
0
20,000
40,000
60,000
80,000
100,000
120,000
2014 2015 2016 2017 2018 2019 2020
India Projects 2014 - 2020 (Upstream, Power, Renewables, Midstream, Downstream - confirmed)
Snapshot Indiua 2014 – 2019 Confirmed EPC Projects
Global Project Demand remains solid.
External shocks in 2011 / 12 – i.e., Arab Sping
- put dampener on project development in
MENA region.
Positive developments in US-Iran relations
Still some concern on situation in MENA i.e.,
Syria, Egypt, Libya
Liquidity coming back to Finance sector which
is good for projects.
Conclusions on Project Demand
Downward pressure on shipping rates has mostly
been caused by significant over capacity / over
supply and fleet expansion in H/L sector.
Significant financial pressure forced restructure and
collapse of some shipping co’s.
Entrance into the market by Capital Funds and
Venture Capital has led to sector consolidation.
Consolidaiton to continue leading to fewer players
and greater market control.
Project Demand is steady and with liquidity coming
back into the financial sector will create further
opportunities for energy and infrastructure projects.
External shocks must always be taken into account!
Rates to gradually rebound end 2014 with pick up
2015/2017.
Conclusion: Supply v Demand
Final thought: Equilibrium – is it too much to ask?!
Thank you!