EMEA News
Danske Bank: Shipping Industry is at the Start of a 5-7 Year Upturn
Danske Bank has released a positive credit analysis of the shipping industry, saying the industry is at the start of a five to seven-year upturn, Shippingwatch reports.
"Shipping cycles historically last 5-7 years, 2014 looking to be the first year in the recovery stage and moving towards mid-cycle earnings," the bank said.
The news that Dankse Bank, a big lender to companies involved in the shipping industry, has upgraded the industry outlook to "improving" signals an expectation that the shipping industry is set to grow globally.
Commentators have pointed out that this, by association, is good news for the bunker markets.
"We're seeing a positive trend in the shipping market. This applies broadly across the segments, including chemical tanker, though we don't believe this market will really take off until 2015 or 2016," says Bjørn Kristian Røed, shipping Analyst at Danske Bank.
This optimism is already filtering down to the bank's view of individual companies, including J Lauritzen and Odfjell, whose standings have recently improved at Danske Bank.
Despite the optimism, large conglomerates and those with a diversified portfolio of shipping activities are still seen as the safest bets by the bank.
Earlier this month, Danske Bank said carriers who fail to comply with Emissions Control Area (ECA) rules risk having their loans canceled.
