Dry bulk shipowners' group Intercargo has warned that the practice of breaking legally binding contracts has become widespread since the onset of the global recession and that it will backfire on charterers.
In its latest newsletter Intercargo says that market corrections, including the scrapping of an estimated 53 bulkers since 1 January and delays in the delivery of newbuilds, have “significantly stabilised the dry bulk market”.
Nevertheless, Intercargo says, “fundamental structural problems remain including a lack of global demand for manufactured goods and a disintegration of trust between parties who seek every opportunity to re-negotiate previously agreed contractual terms on a 'Sue us if you want to' basis”.
Intercargo says it believes that “such an apparent disregard of the principles through which business is sustained over an entire shipping cycle will eventually back-fire once the global stimulation of economies filters through to an increased demand for shipping services”.
“Will shipowners fall over themselves in the upturn to do business with parties who seek to re-negotiate agreed terms so easily? We do not know the answer to this but the dangers of a breakdown in trust should not be underestimated if we are to find ourselves in the sort of industry driven by quality that all Intercargo members aspire to,” Intercargo warns.