The 2017 Shipping Market in the Eyes of International

 Moore Stephen partner Richard Greiner recently predicted that oil prices will continue to rise in 2017, there will be more ships to send demolition, in addition to meet the new regulatory requirements for the transformation of the ship the cost will be more clear.
Looking ahead 2017, Greiner points out that shipping industry forecasts are constantly changing, such as who can predict that SEK will be acquired by SGX?
"With the OPEC production cut, oil prices will continue to rise, and in order to balance the market supply and demand, we call for more ships to send demolition.In addition, with the entry into force of the Ballast Water Convention, and the use of low sulfur fuel, to meet the new Regulations, to transform the ship, the increase in the cost of the cost will become increasingly clear.
In addition, he also mentioned that this year there will be more new ship delivery, some shipyards may go bankrupt; freight will be difficult to achieve the desired level; integration will be the key to container transport; attention to network security will be more and more high.
When it comes to what is unlikely to happen in 2017, Greiner sees "a sharp dro in oil prices and a substantial increase in hull insurance premiums."
In addition, Fitch, one of the world's top three rating companies, recently reported that there will be more acquisitions in the shipping industry in 2017. Fitch's rating shows that weak demand growth will exacerbate excess capacity in the shipping industry in 2017, Pressure, and further promote integration and bankruptcy.
Fitch expects the performance of all sectors of the shipping industry are under pressure, thus maintaining a negative outlook for the container transport sector. As the container shipping business continues to collapse, large liner companies have lost billions of dollars. Although some shipping companies (including Hanjin Shipping) have been liquidated, more companies are looking for consolidation possibilities. Integration will further strengthen shipping companies' capabilities and allow them to remain viable in business. However, in the reorganization process, is bound to layoffs.
At the same time, according to Fitch's view, the tanker transport sector will be slightly weaker than the dry bulk shipping and container transport pressures. Many container and tanker companies have shown in their recent reports that there are enough cash to cover short-term liabilities, but they still rely on uninterrupted access to bank financing to cover negative cash flows. Such financing is more critical for companies that can not pay their maturing liabilities.
Therefore, according to Fitch's data, the world's seventh largest container liner Hanjin Shipping declared bankruptcy, may have a profound impact on the market. In particular, the withdrawal of support by creditors may indicate a reassessment of the financing situation. Of course, even if the market conditions worsened, the new ship's guarantee bank funds are still relatively convenient.
Fitch expects more mergers and acquisitions and bankruptcies in the short and medium term. However, if the market can reduce the supply capacity, will promote the balance between supply and demand and increase tariffs. In container transport, Fitch anticipates that consolidation will affect all companies, small operators will be committed to survival through increased size, and market leaders such as Maersk Shipping will be through mergers and acquisitions to protect its market position.