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Latest investigation report: Global shipping confidence index fell slightly
Shipping consulting and accounting firm BDO said that the shipping industry confidence index fell slightly in the past three months, mainly due to concerns raised by trade wars and increased regulations.
A recent survey of shipping confidence shows that from March to May 2019, the average confidence index was 6.1 (10 out of 10), while the previous figure was 6.2.
From a regional perspective, Asia's confidence index rose from 5.8 to 6.0, while North America rose from 5.6 to 6.4. However, the level of confidence in Europe fell from 6.3 to 6.1.
From the perspective of the sector, the tenant's confidence index rose from 6.0 in the previous period to 6.2. Shipowners’ and managers’ confidence indices slipped from 6.3 and 5.9 to 5.8 and 5.7, respectively.
Respondents' willingness to make major investment developments in the coming year rose from 5.3 to 5.4, with shipowners' willingness rising from 5.4 to 6.3 and tenants falling from 7.3 to 5.6.
Respondents expect that financing costs will rise by 48% in the coming year. Among them, shipowners and ship brokers have declined, while tenants and managers have risen.
26% of respondents believe that demand trends are most likely to affect performance in the next 12 months, and the second and third factors are competition (19%) and financing costs (13%).
In addition, 55% of respondents believe that the freight rate in the tanker market will rise in the next 12 months, which is a 4% increase from the previous period. And 48% of respondents believe that dry bulk freight prices will rise, and the proportion will fall by 4%. Respondents who believe that container freight rates will rise are 35%, an increase of 9% over the previous period.
Shipping & Transport partner Richard Greiner commented: "The confidence index fell a little unexpectedly, because the Sino-US trade war, the tension in the Arabian Gulf, the failure of the Brexit negotiations and the political instability in many parts of the world have led to market volatility. There are many challenges, but there are also some positive factors. The new technology makes shipping more popular with investors, and it also drives development and a virtuous cycle. Logically, freight rates will rise, and those who act calmly will eventually benefit."
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