Tanker scrapping slowed in 2015 due to three
key factors: Stronger spot market returns, low price being offered by buyers at
the recycling yards, and the demand to store oil following the price collapse
in late 2014. Each played a part as the decision to remove a ship from service
varies depending on the financial situation of the owner. Some may be motivated
as the $/t offered price offsets enough of their remaining mortgage on a ship
to allow them to move out of a low cashflow market, while others may remove a
ship after it completes a long-term storage contract.
Higher spot market returns were due to higher
levels of removals over the past several years combined with a low level of
orders. This led to a contraction in fleet sizes in many segments.
Restrictions on emissions in China as the
country grapples with air pollution issues has led to a rise in steel prices.
The impact of this is seen in the global steel markets, which influences the
value recyclers are willing to pay per lightweight ton. The price being offered
in India for tankers and bulkers has been trending upwards since mid-2016.
The sudden drop in oil prices led to a demand
for floating storage as shoreside tanks filled due to contango in the oil
markets. Older ships were taken on three to 12-month charters to store oil as
they were able to offer lower $/day numbers than prime (less than 10 years)
aged ships. The employment of these ships removed them as scrap candidates and
kept them on the water.
High scrapping and market consolidation will
contribute to better returns for owners over the next several years. For the
harmony of the global shipping markets continues, older units are removed in a
weak market and replaced with new vessels as rates recover.
Source:
hellenic
shipping news. 01 March 2018
No comments:
Post a Comment