LONDON: The global newbuilding orderbook to existing fleet ratio has dropped to its lowest level in 20 years dropping to just 10% of capacity.
After nearly a decade of tough times for much of the shipping industry the global newbuilding orderbook has been wound down to levels that bode for more rational expansion.
The global fleet stands at 95,000 vessels with some 3,500 on order, equating to 10% of current capacity according to a report by Crucial Perspectives.
“We have not seen this level of more rational shipping fleet expansion since 1999-2000 in the aftermath of the Asian financial crisis,” a new report said.
The cruise ship segment has the highest orderbook ratio at 40%, but in some good news for the sector the growth is fairly evenly spread with 6% this year, and Crucial Perspectives believes it will be met by demand. There were, however, more concerns the market impact this year about other sectors with a high orderbook – LNG and drillships.
For LNG vessels the orderbook to fleet ratio is 23% and for drillships it is 21%. “Sixty-two newbuild LNG carrier deliveries are expected to add 13% to the global existing LNG shipping capacity for the rest of 2018 assuming no vessel demolition, and delivery slippage. This could cap the recent recovery in LNG carrier spot rates,” the report warned.
Looking at the offshore sector the report commented, “In the offshore marine segment, the delivery of 153 newbuild platform supply vessels (PSV), 135 Anchor handling tugs and 10 drillships for the rest of 2018 will add 11%, 8% and 8% to the global existing fleet capacity which could keep day rates under pressure as well.”
There were also concerns about the tanker sector where the orderbook ratio stands at 12% and 7% fleet growth is expected this year which could put a cap on rate growth in a sector that is already depressed.