Cosco set for new normal

Chinese giant Cosco is bracing for a continued low rate environment in the bulker and boxship markets describing the present economic climate as complicated.

Chairman Ma Zehua explains the company believes shipping markets have established a new normal with low demand growth and oversupply which is difficult to change in the short term.

Writing in the owner’s annual report, Ma said: “It is expected that the shipping market will present a fluctuating trend at low levels which will last for a period of time.”

He says the gap between supply and demand in container shipping remains severe thanks in part to a rising number of vessels over 12,000-teu.

For dry bulk he notes Clarksons is expecting demand to grow by 3.7\% this year, while supply will rise by 4.5\%.

“The overall market will still be hovering at low levels and a full recovery still takes some time,” he said.

Ma added: “Facing the ‘new normal state’ in the global economy and the shipping market, China Cosco will focus more on the synergies among companies within internal business segments and strive to enhance the four strategic aspects of profitability, anti-cyclical effect, globalization and increase in scale.”

In boxships, Cosco will focus on efficiency and global development targets with comprehensive cost controls and the fleet structure changed to master large size vessels and energy conservation, the chairman said.

In dry bulk, Cosco will look to centre on what Ma calls anti-cyclical capabilities, with control on new capacity and an accelerated restructuring of cargo sources and customers and a targeting of COAs.

source:www.traewindsnews.com