LR sound note of 'cautious optimism' on 2019 outlook

Looking back on 2018, Brown noted the shipping markets “were significantly up on the previous two years” as dry bulk and container ship rates perked up, with product and crude tankers also rebounding late in the year, while saying this does not “mask some significant roller-coaster earnings within specific segments”.

 

He referred to the 9% drop in newbuilding orders year-on-year while scrapping fell by 12% over the same period, with the end result being a record fleet size of 1.97bn tonnes at the end of the year.

 

Brown said, “LR has maintained its leading position in global new construction, with a significant market share of 23% and grew its share of the global in-service fleet, continuing the trend that has seen LR increase its share of the world fleet by over 25m gt since 2016.”

Looking ahead he saw “uncertain times” as concern increases over global trade growth  in a climate  of increasing geopolitical risks an rise of protectionism and the US / China differences. Most positive outlook seems to be for the tanker market and there are signs the recovery in the offshore market will continue, albeit still at a low level.

 

Brown said the key theme for 2019 "is undoubtedly the gearing up for the implementation of the IMO sulphur 2020 limit" which will present many challenges. “While the challenges posed by the 2020 fuel change are not to be underestimated, the industry can tackle these with a sense of confidence if sufficient planning, preparation, stakeholder engagement and proactive fuel change management is implemented,” he said.

 

To achieve this he called for greater collaboration in the industry to address these challenges, together with the help of new digital solutions.

 

He also noted that with so much attention on upcoming environmental regulations as well as all things digital, it is doubly important to reflect on safety. Brown noted: "Safety of navigation and operation are not only mission-critical objectives in their own right, they are also major contributory factors to successful environmental performance and successful digital adoption and commercial success."

 

Having already started 2019 with several marine incidents including fatalities and environmental damage  -- MSC Zoe, 270 containers lost in North Sea; Maersk Gateshead, oil spill in Hong Kong; and Hapag Lloyd Yantian Express, fire onboard -- Brown said “safety of the vessel, its crew and its cargo must remain our industry¹s core focus” and this isn’t just in terms of physical safety, “as increasing connectivity and digitalisation increase the vulnerability to cyber security risks and associated safety implications to the vessel, crew and cargo”.

 

 

Brown concluded by wishing all present a happy, healthy, prosperous and safe 2019 as well as reminding guests “to be careful as there is a lucky coin in the Vassilopita”.