Accounting Network Moore Stephens has released a report stating that the average shipping confidence level rose from 5.4 in August 2016 to 5.6 out of 10.0 in November 2016. This is the highest rating since August 2015.
All main categories of respondent were more confident than in August 2016, when the overall rating was 5.4. The report also revealed that confidence was up in Asia, from 5.5 to 5.7, in Europe from 5.2 to 5.4, and in North America from 5.8 to 5.9. Interestingly, charterers' confidence attained a notable growth, rising two points to 6.8. This marks the highest figure for such respondents since the survey was initiated in May 2008.
A number of respondents felt that the bottom of the cycle had been reached and that the only way was up. Particular concern was expressed about overtonnaging, insufficient recycling, and the cost of regulatory compliance. One respondent noted, “The oversupply of tonnage will cease when the banks write down bad loans and force owners to sell for scrap,” while another said, “The weak or unlucky will fold or be gobbled up, while the strong or the lucky will grow and succeed.”
It is believed that competition is likely to influence performance the most over the next 12 month period.
Richard Greiner, Moore Stephens Partner, Shipping & Transport, said “Despite overtonnaging, weak freight rates, declining demand, insufficient recycling, Brexit, Syria, Trump, despite everything, shipping is still looking up, rather than down,” “This is not to deny the reality of today's difficult market, or the sluggish economic climate. But it does say much for the strength of shipping's backbone and the quality of its mettle.”
Greiner went on to say “This is not to deny the reality of today's difficult market, or the sluggish economic climate. But it does say much for the strength of shipping's backbone and the quality of its mettle.
This increase marks successive shipping confidence increases after May 2016 also saw a rise.