Shipping confidence at highest level since 2008: Moore Stephens

On a scale of one to 10, low to high, confidence was at 6.5 in February 2014, up from 6.1 in November 2013 and approaching the survey's peak of 6.8 from May 2008.

Confidence rose across the board, with all of the survey's respondent categories showing an upturn: shipowners, charterers, managers, brokers, advisers and others.

"Six years is a long time in shipping. Indeed, based on empirical evidence, it is long enough to qualify as a cycle in what is an historically cyclical industry," commented Moore Stephens shipping partner, Richard Greiner. "It is perhaps too soon to say that we have reached the end of the most recent downward cycle, but it seems that the worst may be over. This latest survey finds confidence in shipping at its highest level since 2008, with genuine prospects for further improvement over the next twelve-to-eighteen months."

While some respondents welcomed the reduced threat of over-tonnaging, others were worried about the impact of private equity funding and its effect on the decisions of ship owners.

"There appear to be a lot of private equity funds, or vulture funds, willing and able to invest in shipping, which helps to increase confidence levels because the investors in such funds normally expect a significant rate of return." commented one respondent. Others cautioned that, "the oversupply of tonnage, together with private equity investment, will continue to depress rates and delay recovery," and, "the flood of private equity funding, which must be spent before it reaches its sell-by date, persuades previously sensible operators to ignore basic economic principles. It's happened before."

The survey also asked the likelihood of respondents making a major investment or significant development within 12 months, which stayed at 5.8 on the same one to 10 scale.

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