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MAN sees better times ahead for shipping

"There is no doubt that the order backlog is melting out and evaporating," was the grim opening line from Ole Groene, svp at MAN Diesel and Turbo, given against a backdrop of charts showing deliveries of low speed engines and ships, both peaking between 2010 and 2012, before trailing off up to today and into the future forecasts.

Speaking at MAN B+W's state-of-the-art Primeserv Academy in Copenhagen, which was officially opened this week, Groene added "In China they are screaming for orders... they are not alone; they are screaming in Korea, they are screaming less in Japan, but the situation is that there is space and availability for new orders to come in."

As with many owners and shipyards, MAN is seeing signs that market has hit its lowest level, and reasons for optimism are emerging.

"In the last month we saw the order intake grow bigger than deliveries... the backlog in May was larger than in April," Groene declared, backed by an uptick in the engine orderbook at MAN's licensees to around 23GW. "We all agree, and also the analysts we rely on agree, that world trade and shipping is a growth area, and this means that there will be a need for the order backlog to come up again. It will not necessarily go up at the same pace as it did in 2006 to 2008, nobody expects that, but it is expected to increase."

In MAN's forecast figures for ship contracting, delivery and deletions, the forecast for 2013 is marked by contracting rates below demolition rates, a characteristic it shares only with the post boom hangover year of 2009.

After a sharp drop in deliveries over 2,000 dwt from around 1,900 vessels in 2013 to 1,350 in 2014, the situation is set to improve. The forecast is one of steady increases in contracting from the estimated 1,100 ships ordered in 2012 up to almost 2,500 in 2021, with deliveries enjoying a similar steady growth and not exceeding the contracting rate until 2021.

Ending on a more positive note than he started, Groene said, "We'll wait for the good times... and we're sure they will come back, we are not alone in this analysis, so we'll be prepared."

Posted 28 June 2013

© Copyright 2019 Seatrade (UBM (UK) Ltd). Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Seatrade.

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