• 2020 February 8 11:14

    Container shipping outlook 2020: credit quality stable; threats to seaborne trade volumes remain, Scope Ratings says

    The container shipping industry is sailing into less choppy waters in 2020: improved cost structures and greater economies of scale will help larger operators cope with regulatory headwinds, higher capital-expenditure, and slowing economic growth. However, the gap in credit quality will continue to widen between the largest global operators which make up the three international shipping alliances1 and the rest of the industry. For the full report, please follow this link, Scopegroup says in its press release.

    “The credit outlook for the container-shipping sector is stable – which is quite something for an industry which has been buffeted by excess shipping capacity, volatile fuel prices and freight rates in recent years,” says Denis Kuhn, analyst at Scope.

    “However, downside risks remain,” says Kuhn.

    “Uncertainty over the credit outlook for 2020 hinges on the continued strength of global trade - the determinant of container-shipping volumes - in the context of slowing economic growth, notably in China where the recent coronavirus outbreak will have at least a short-term impact on imports, exports and economic activity,” he says. (See Scope’s 31 January commentary: China: coronavirus outbreak's longer-term policy side-effects more important than direct GDP impact)

    The danger of a re-escalation of international trade disputes is another threat, notwithstanding the recent US-China agreement in their tariff battle.

    Still, Kuhn says several trends are favouring container shipping operators in the year ahead:

    Higher-than-expected scrapping rates as the industry shifts to low-sulphur fuels should improve the problem of over-capacity.
    Spot freight rates will rise, given the uncertainty about shipping capacity, compared with average rates between 2016 and 2019.
    Growing economies of scale and efficiency will benefit the industry leaders as they take advantage of their international alliances.
    The defused US-China trade dispute may limit tariff-related disruptions to global supply chains though residual tensions between the world’s leading trading partners remain a risk.
    At the same time, some of the more profound challenges the sector faces have not entirely disappeared, says Kuhn.

    Excess container-shipping capacity continues to weigh down on freight rates.

    Environmental costs are rising: from 1 January, operators have had to fit vessels with scrubbers to continue using high-sulphur fuel to meet new emissions standards or switch to more expensive ultra-low sulphur fuel.

    Operators, particularly smaller companies, will find it difficult to pass on higher, more volatile fuel costs and/or additional regulatory-related capex costs to customers.

    “The crucial question for ship owners – regardless of which approach they adopt to meeting the new emissions standards - is to what extent they can pass on the additional cost of technical compliance to the end-customer,” says Kuhn.

    About Scope Ratings GmbH
    Scope Ratings GmbH is part of the Scope Group with headquarters in Berlin and offices in Frankfurt, London, Madrid, Milan, Oslo and Paris. As the leading European credit rating agency, the company specialises in the analysis and ratings of financial institutions, corporates, structured finance, project finance and public finance. Scope Ratings offers a credit risk analysis that is opinion-driven, forward-looking and non-mechanistic, an approach which adds to a greater diversity of opinions for institutional investors. Scope Ratings is a credit rating agency registered in accordance with the EU rating regulation and operating in the European Union with ECAI status.




2020 October 30

18:02 Finnlines announces bunker surcharge for Malmö-Travemünde-Malmö
17:38 Expert considers methanol to be more environmentally friendly marine fuel than LNG
17:06 Port of Melbourne releases its 2020 Sustainability Report
16:56 BC Ferries' third battery electric hybrid vessel launches at Damen Shipyard
16:45 Rosmorport took part in the 4th “LNG Fleet, LNG Bunkering and Alternatives” conference
15:21 General Prosecutor's Office confirmed Vostochny Port’s compliance with Presidential instructions on transition to closed coal handling
14:19 Fuelling the industry: Low-emission development strategies at the 7th International LNG Congress
14:03 VARD to build a second advanced stern trawler for Luntos
13:36 Amursky Shipyard launches Ro-Ro ferry and ice-class rescue ship
13:13 Shuttle service to COSCO’s European hub from Vado Gateway commences
13:10 BlueWater Reporting issues intra-Asia container shipping report
12:37 DNV GL hits remote survey hat trick with 20K surveys, 2-year anniversary and new Operational Centre
11:49 Ivan Radchenko appointed as General Manager at Moby Dik Terminal
11:14 Tuapse Sea Commercial Port increased its throughput by 10% in 9M’2020
10:38 IAA PortNews thanks partners and sponsors of 4th LNG Fleet, LNG Bunkering and Alternatives conference
10:17 The CMA CGM Champs Elysees joins the fleet
10:05 Arctic LNG 2 ice-class tanker fleet formation completed
09:43 Bunker Market this morning, Oct 30
09:40 Bunker prices go down in the Port of Saint-Petersburg, Russia (graph)
09:23 Oil prices are recovering
09:12 Baltic Dry Index as of October 29

2020 October 29

18:31 Wan Hai Lines to launch Straits – Bangladesh Express Service
18:09 Lloyd’s Register launches dedicated Maritime Decarbonisation Hub
17:56 Bill on corporatization of FSUE Rosmorport submitted to RF Government
17:56 Hapag-Lloyd announces winter surcharge to and from St. Petersburg and Ust-Luga
17:30 Rosmorport’s Azov-Black Sea Basin Branch purchased 5 tugboats
17:05 Wärtsilä to collaborate with Anemoi Marine Technologies in future sales of Rotor Sail solutions
16:59 Romania’s border authorities using EMSA RPAS for coast guard surveillance
16:35 Jon Fredrik Baksaas appointed DNV GL’s Chair of the Board
16:17 Nordion Energi moves closer to the aim of 100% green energy by joining the European Clean Hydrogen Alliance
16:01 Port of Los Angeles streamlines online permit process
15:28 MABUX released Bunker Weekly Outlook
15:22 Bunker prices are slightly down in the Far East ports of Russia (graph)
15:20 CMA CGM announces Peak Season Surcharge from China to Russia
15:01 Partnership agreement between leading Hamburg Port Authority and Tanger Med Port Authority
14:36 Port Kolomna takes delivery of multibucket dredger of Project 3409
14:11 MAN compressor technology for largest FPSO vessel offshore Brazil
13:53 Novatek to launch LNG terminal in Rostock (Germany) in 2023
13:30 Rosatom looks into using barges for LNG delivery to Arctic regions
13:11 IMEC and ITF opens big quarantine and testing facility in Manila
12:52 RS grants GASA to GTT’s Mark III Technology
12:29 Rosatom expects reactor plants RITM-200 to be efficient for container carriers and oil tankers
12:10 GTT entrusted by Zvezda with the tank design of ten ARC7 ice-breaking LNG сarriers
11:48 USC forecasts complete transition of shipping industry to electric propulsion in 20-25 years
11:30 Rijkswaterstaat has awarded the enlargement of the Twente canals to a consortium of Van Oord - Hakkers - Beens
11:09 DSV Panalpina acquires Prime Cargo
10:50 Novatek to put into operation 30,000-cbm gas carrier under Cryogas-Vysotsk project in 2022
10:37 Volvo Penta IMO III marine generator sets help power five electric ferries in Norway
10:09 International Association of Dredging Companies signs major strategic collaboration agreement with FIDIC
09:51 MABUX: Bunker Market this morning, Oct 29
09:46 Three LNG-powered product tankers for shipment of stable gas condensate from Ust-Luga to be delivered in 2022-23
09:24 Oil prices show slight increase
09:20 Vestdavit wins contract to supply six French Navy vessels
09:12 Baltic Dry Index as of October 28

2020 October 28

18:15 Sri Lanka's East Container Terminal inaugurates for operations
17:51 Tallink Grupp makes temporary changes to Tallinn-Helsinki route schedule from 29 October 2020
17:30 Key element of Russia’s collider facility NICA transshipped in Bronka
17:06 GONDAN delivers new fishing stern trawler to Prestfjord AS
16:39 Rosmorrechflot resumes work on programme for encouraging LNG-powered shipping
16:13 Cavotec launches next generation MoorMaster