Source: Moore Stephens
January 5th 2017
Wednesday, in the release of its quarterly Bottom Line newsletter, said “shipping will find a way” through another tough year in 2017.
“Confidence in shipping increased steadily for most of 2016, underlining just how robust the industry can be in difficult times,” said Moore Stephens.
“The inherent volatility of the industry will continue throughout 2017, during which time shipping will resort to tried and trusted methods and to fresh innovation alike in an effort to keep its head above water.”
The consultancy, highlighting a number of challenges that shipping may face in 2017, suggests the year will see a number of shipyards fall under further stress if newbuilding orders are not received, while freight rates will continue to struggle to reach levels of commercial viability, and consolidation will continue to be a focus of the liner trades.“If operating costs do not increase, concern will spread about whether quality and safety are being sacrificed,” adds Moore Stephens, noting that, like other industries, shipping will also be waiting to see what impacts Brexit may bring.
Confidence in shipping increased steadily for most of 2016, underlining just how robust the industry can be in difficult times.
Further, the consultancy says the cost of meeting regulatory requirements will grow more apparent within industry, with financiers left to struggle with the financial consequences of having to burn bunkers with lower sulfur contents and ensure that ballast water management systems are compliant with applicable regulations.
“Things that will not happen in 2017 include another major fall in oil prices, and a big increase in hull insurance rates,” noted Moore Stephens, adding that oil prices should continue their upward trend, while calls for increased ship demolition will grow - although whether ship demolition itself grows alongside those calls is not as clear.
Moore Stephens’ outlook for 2017 echoes that of a BIMCO report published Tuesday, which suggests 2017 will be another tough year for major shipping sectors, including tankers.