Shipping Confidence Sees Another Increase, Hits 9 Month High: Moore Stephens

Moore Stephens says shipping confidence was up from 5.1 at the end of May to 5.4 at the end of August 2016.

Moore Stephens Monday said shipping confidence during the three months to the end of August rose to 5.4 from 5.1 at the end of May - the second successive quarter of improvement, and the highest level in nine months.

The rise in confidence was particularly noted among charterers and managers, which was up from the previous period from 4.0 to 4.8, and 5.1 to 6.0, respectively.

Brokers' confidence is also noted to have risen, increasing from 4.3 at the end of May to 4.5 at the of August, while owners' confidence was down during the period, falling from 5.7 to 5.3.

In geographic terms, confidence in Asia increased during the three month period, rising from 5.2 to 5.5, while confidence in North America rose from 5.0 to 5.8, and Europe remained unchanged at 5.2.

Overcapacity, shipping market conditions, and the global economy are noted to have been the concern of many survey respondents.

"Brexit, Trump, supply overhang, consolidation, demolition, bankruptcies, and the low risk appetite of banks for shipping and shipping stocks seem to be the main topics to follow for the next 12 months or so. We would be pleasantly surprised if this were to change," said one respondent.

Respondents also expressed concern for the dry bulk sector following confirmation from the International Maritime Organization (IMO) earlier this month that the Ballast Water Management (BWM) Convention will enter into force on September 8, 2017.

"Implementation of the Ballast Water Management Convention will most likely solve overcapacity," said one survey respondent, adding: "but it will also cause a bloodbath among owners."

Richard Greiner, Partner, Shipping & Transport at Moore Stephens, commenting on the results said: "given the challenges currently facing the industry, the continuing uncertainty surrounding the worldwide economy, and the ongoing level of global geopolitical instability, it is encouraging to see an increase in shipping confidence for the second successive quarter."

"Confidence is now at its highest level for nine months, which says much for the resilience of the shipping industry."

Earlier this month, Moore Stephens, in its second annual Shipping Risk Survey, said that not enough shipping companies are utilising sufficient risk management procedures.