Ships being laid up as trade slows

April 8, 2009
Singapore Democrats

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Otago Daily Times

The viability of some shipping lines is being questioned with hundreds of ships laid up across the globe and at anchor as trade and cargo volumes dwindle.

Dunedin-based DCB International director Mark Willis said a recent photograph of vessels at anchor in Singapore, one of the world’s busiest ports, underscored the extent of the global downturn.

He said while many of the ships at anchor were smaller “feeder” and “tramp” vessels, they would normally be delivering domestic cargoes to fill Europe and US-bound ships which can carry 8000-10,000 containers each – a size of ship New Zealand harbours can not host.

He confirmed up to 80% of Singaporean vessels were anchored up, and space was being sought to store 200,000 containers, By comparison, that is the entire year’s container volume across Port Otago’s wharves.

Singapore port owners last month reported a 46% decline in after-tax profit for 2008 to $US690 million, despite posting a 7% increase in container volumes to 63 million, but which since July last year had seen a collapse in demand, news site China View reported.

Mr Willis said during the recent economic boom “new build” vessels were ordered under contract, but with the global recession now there was no cargo available for them as they were being launched and delivered.

“There’s some real concern about the viability of some [shipping] lines out there. The new builds, being delivered under contract, are not generating revenue,” he said.

Conversely for New Zealand, there are not enough ships at present to service the peak trade requirements of exporters and a small number of dry produce export containers are being left on Port Chalmers wharves, in preference to moving contracted refrigerated containers. However, this annual problem for Otago was expected to ease by the end of the month, Mr Willis said.

http://www.odt.co.nz/news/business/50799/ships-being-laid-trade-slows