The OSV sector will need another five years for the supply glut to deflate as the market struggles through its worst recession that started five years ago, according to M3 Marine Group ceo Mike Meade.
Tonnage oversupply has dampened the overall freight market outlook this week, especially in the case of the oversupplied capesize market.
The shipping of cement is becoming more efficient and more realistic led by developments in the Asia market where the demand has not only heavy, but cargoes are being lifted in a new wave of ships.
A fall in container freight rates is being driven by oversupply of vessels rather than a drop in demand according to analyst Crucial Perspectives.
The tonnage oversupply problem will continue to shadow the global container shipping market over the next couple of years despite international carriers’ efforts at realigning alliances to optimise tonnage, increased scrapping and a major carrier bankruptcy.
Excess capacity in shipping and offshore will not go away “in a hurry” due to the sectors having witnessing a prolonged period of having access to “too much cheap money”, according to Piyush Gupta, ceo of DBS Group.
Oversupply of tonnage will continue to hit freight rates for the “near term” followed by a sudden leap in demand after delayed projects complete, according to Drewry's latest report.
The huge surge in product tanker newbuilding orders since the second half of 2013 could spoil a recovery in the market warns Banchero Costa research head Ralph Leszczynski.