World News
Maersk Exec: Slower Speeds, Scrapping, Idling will Keep Market Balance
Maersk Line Chief Executive Søren Skou told reporters at a news conference in Singapore on Monday that slower vessel speeds, and more scrapping and idling of ships will help the container shipping industry maintain balance even as capacity growth outpaces demand, Dow Jones reports.
"We expect to get a reasonable balance between demand growth and supply growth. But it requires that the industry acts in a reasonably fair manner," Skou said.
He said he expects the industry to put previously announced rate increases into effect starting this month, helping to avoid a rate war that could hurt the industry.
Maersk Line, the shipping arm of A.P. Moeller Maersk, improved its results in 2012 through rate hikes.
Skou said container ship capacity is expected to grow 11 percent this year, but slow steaming will reduce effective capacity by 2 percent, while 2 percent of the global container fleet may be scrapped, and the percentage of ships that are idling may grow from 5 percent to 6 percent.
Meanwhile, he said, demand on Asia to Europe routes may grow between 3 and 5 percent, while Asia to Africa and Asia to Latin America routes are rising at about 5 percent per year.
Shipping services company Clarkson Plc. predicted in December that global container line volumes will rise 6.6 percent in 2013, but industry capacity will outpace that rate, rising by 7.5 percent.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 502.00 | 7.00 | 617.00 | 6.00 |
| Rotterdam | 455.00 | 8.00 | 619.50 | 4.00 |
| Houston | 467.00 | 4.50 | 625.00 | 2.50 |
| Fujairah | 495.00 | 6.00 | 712.50 | 1.50 |
| Global 20 Ports Average | 524.50 | 4.50 | 710.50 | 4.00 |
| Global 4 Ports Average | 479.50 | 6.50 | 643.50 | 3.50 |
| Global Average Bunker Price | 570.50 | 2.00 | 747.50 | 5.50 |
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