This is an extremely exciting time for the shipping industry which is expected to undergo a major transformation over the next decade.
A number of variables are likely to play their role in the shaping of the industry’s future way of doing business ranging from the third industrial revolution to electric cars and the switch to renewable energy and digitalization.
However, being such a resilient sector shipping tends to find opportunities in disruption.
Speaking at today’s Power Panel, organized by BIMCO within the Posidonia 2018 trade show, industry representatives from various branches shared their views on the most exciting things in the industry at the moment.
Basil Karatzas, CEO of Karatzas Marine Advisors, said that the most exciting thing on the market was the freight perspective.
“It makes the market return to the fundamentals and give it more thought. What is more, it keeps away speculative investments,” he said, adding that most of newbuildings orders placed so far were for the purpose of renewing fleet or ensured cargo for vessels.
Among the five things to watch out for in the medium to long-term are digitalization and the use of advanced analytics which have already started to transform the shipping industry, according to Henriette Brent-Petersen from DVB Bank.
“We are on the verge of the beginning of a revolution of our industry. It is not only that the business model changes, but all levels of the supply chain,” she explained.
One of the examples to support this argument is the rise of the smart-yards, Brent-Petersen said, which are forecast to automate their manufacturing process and start producing ships copying the Volkswagen model of building cars. This will ultimately put a permanent pressure on the newbuilding prices, she went on to say.
“The most exciting thing at the moment in shipping is Posidonia,” Simon Ward from Ursa Shipbroking said, stressing that shipping boils down to relationships.
“This interaction of people from various areas of the industry is where the new ideas come from and where relationships are forged. Conferences like this one are the places where exchange of technology and innovation takes place: through people. If we lose that we will lose the nature of shipping itself.”
For Valentina Vignoli, from Peninsula Petroleum, a bunker supplier, the most exciting thing at the moment is the 2020 sulphur cap.
“It is the first step for the industry to move into an era of greener fuels. In the medium term we might even see new types of fuels being developed to comply with the new regulations, which is exciting and challenging at the same time,” she said.
Finally, James Leake, analyst at N.S. Lemos, believes a very close eye should be put on the developments in India, and specifically its teenage population as the source of emerging households.
“Given the shape of Indian population pyramid it is the place to watch out for in the five to ten years. I’m not going to claim that it would set the market on fire, but if we are looking for optimism that is the only place growth can come from speaking from a structural perspective; population-wise.”
In conclusion, as stressed by Karatzas, it has become ever more difficult to predict the future and these are very uncertain times for the industry.
Nevertheless, there are at least five things to closely monitor as the industry steams ahead into the uncharted waters.
Reported by Jasmina Ovcina Mandra