Shipping in peril from the coronavirus aftermath
The shipping industry as a whole is in dire straits, as a result of the negative impact from the Coronavirus. It’s not only freight rates which are crashing, but also other aspects of the industry, like for instance shipbuilding and shiprepair activity. The Shipbroker Allied Shipbroking said that “with China and the world still trying to contain the effects and come to terms with the Wuhan novel coronavirus outbreak, the shipping industry sees freight markets in a complete state of collapse as demand gets paralyzed by the ensuing effects. As a general rule of thumb during the past decade, shipping markets tend to underperform when China’s economy is not at it’s best.
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DNV GL: wind ships ahead
The physical principle is the same one humans have used on sailing boats since eons ago: the wind hits the leading edge of the sail and splits into two flows which are redirected and travel at different speeds towards the trailing edge, causing a pressure difference that simultaneously pulls and pushes the sail and the craft forward. What has changed is the efficiency. Advanced science has doubled the amount of propulsion power per square metre of sail surface, says Marc Van Peteghem, naval architect and co-founder of VPLP Design. Together with the French engineering firm CNIM, VPLP has developed a new wing sail concept they call OceanWings, based on an existing VPLP idea. In recent years a number of attempts have been made to combine the propulsion principle of traditional sailing boats with the aerodynamic efficiency of an aeroplane wing with the trailing edge flap extended for starting or landing.
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Demolition market under pressure as rates decline
The current freight rate crisis across most markets could offer a solid opportunity for ship owners to sell some of their older ships and alleviate tonnage oversupply issues. However, over the course of the past week, prices offered by scrapyards have also started to retreat. The shipbroker Clarkson Platou Hellas said that the market has been awash again this week with varied large dry units being circulated and, not surprisingly, sales concluded earlier in the year are now surfacing showing the full extent of the busy start to the year in this sector. Interestingly, this week we are seeing alternative types of tonnage filtering through and resulting in Buyers taking their pick of their preferred choice, dependant on their current requirements. It has been sometime since the market has felt this busy after what was a depressing 2019 for the industry and provides further optimism that 2020 could potentially reach dizzy heights.
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Owners and charterers believe voyage efficiency savings of 28pc
A survey has found that shipping sees a vast potential reduction in fuel consumption. Responding to a survey by NAPA and BLUE Insight, owners, managers, operators and charterers felt that on average, it was possible to reduce 28 percent of their fuel consumption – a figure that that aligns with some recent studies on voyage optimisation. The same respondents saw validation of data and cost as the biggest obstacles to their adoption of digital optimisation solutions. While actual estimates of ship performance improvements vary widely, and depend heavily on vessel type, this estimate of potential performance improvements aligns with some recent studies. For example, a recent study by Miika-Matti Ahokas at Aalto University found that the potential for fuel saving and emission reduction from voyage optimisation on mid-range tankers could be up to 28 percent, depending on the optimisation strategy. For the shipowners, the consequential reduction in fuel cost would result in approximately 17.8 percent increase in the average daily financial performance of the fleet. However, economic incentives undermine much of the benefits that could be delivered by speed optimisation.
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US companies keen to expand Portugal’s Sines port
American companies have a strong interest in expanding Portugal’s deepwater port of Sines due to its strategic position for liquefied natural gas (LNG) exports to Europe, U.S. Energy Secretary Dan Brouillette said. Portugal launched an international tender in October for a contract to build and operate a new container terminal in Sines, continental Europe’s closest port to the Panama Canal. It expects to pick the winner in the last quarter of this year. Simultaneously, Singapore’s PSA, which operates the only existing container terminal in the port, is also in the process of increasing its capacity. The planned overall expansion will be crucial to also increase the port’s capacity to receive larger ships and more LNG cargoes from abroad for further shipments to Europe. Portuguese Infrastructure Minister Pedro Nuno Santos said the U.S. interest and potential investment was “an opportunity we must seize”. In the tender, U.S. companies may still face competition from Chinese rivals such as state-owned Cosco or Shanghai International Port Group, which have expressed interest in expanding the port, according to the source. Brouillette made no reference to Chinese plans in Portugal, but in the past Washington has expressed concerns about heavy Chinese investment in Portugal’s energy sector including large stakes in grid operator REN and power utility EDP-Energias de Portugal.