MARLOW NEWSLETTER - Marlow Navigation

4th Issue
At the present time, the financial
crisis and how it has affected our
industry is of primary concern to us all.
Our attempt is not to clarify all aspects of
this subject, but rather, to give a simple
overview on the primary mechanics that
have influenced our industry to its
present situation.
As a direct consequence of the current
financial situation, the daily hires for
medium-sized ships carrying iron ore,
grain, coal and cement as well as
containers have substantially been
reduced. Today, you can hire the same
ships for considerably reduced rates than
a year or even six months ago.
Freight rates are under pressure due to a
slowdown in demand for commodities.
The biggest impact has come from a
slowdown in Chinese imports of raw
materials. The world market had been
expecting Chinese factories to resume
importing raw materials after the
Olympics.
June 2009
C r i s i s I n T h e S h i p p i n g I n d u s t r y
These expectations fell short when China
said that it had ample inventory of metals
and other raw materials in the pipeline
with hardly any further demand.
With crude oil prices cooling off, the
demand for oil tankers slowed down,
leading to softening of tanker charter
rates slowing even further the global
economy.
The charter market has come to a virtual
standstill with carriers reluctant to take on
new tonnage, or renew expiring charters.
Instead of committing to long-term
charters of 12 months and more, carriers
are fixing ships either on a spot basis or
periods between one and three months as
to cover immediate requirements.
After all, the market forces of “offer and
demand” are perfectly demonstrated. We
have today a lot of ships available and
more newbuildings are coming into the
industry ready to transport raw material
and products, the quantities of which are
reduced.
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