Shipping confidence hit a four-year high in the three months to the end of February, according to a survey by international accountant and shipping adviser Moore Stephens.
The average confidence level expressed by respondents was up from 6.2 out of 10.0 in November 2017 to 6.4 this time around. Confidence on the part of owners was also at a four-year high, up from 6.4 to 6.6, while managers’ confidence was up from 6.1 to 6.4.
Confidence was up in Europe from 6.3 to 6.6, equalling the highest ever rating for this category of respondent in the life of the survey, which was launched in May 2008. Confidence was also up in Asia, from 5.7 to 6.3, and in North America, from 5.8 to 5.9.
The likelihood of respondents making a major investment or significant development over the next 12 months was up on the previous survey from 5.3 to 5.5 out of a maximum possible score of 10.0 — its highest level since May 2014.
“Shipping is more confident of making a major new investment over the next 12 months than at any time in almost four years, even though finance will probably be costlier to access in the year ahead,” says Richard Greiner, Moore Stephens partner, Shipping & Transport. “Net freight rate sentiment is positive in all main tonnage categories and, whilst slightly down in tankers, it increased both in the dry bulk and container ship trades.”
The number of respondents who expected finance costs to increase over the coming year was up from 59 per cent last time to 64 per cent, the highest figure since May 2008 (66 per cent).
Demand trends, meanwhile, were cited by 24 per cent of respondents as the factor expected to influence performance most significantly over the coming 12 months, followed by competition (19 per cent) and finance costs (15 per cent).
“Familiar problems persist,” Greiner explains. “Excess tonnage in many trades and insufficient demolition levels continue to perpetuate uncertainty, and freight rates are not yet at the levels required to turn promise into reality.
“In the wider world, the impact on shipping of continuing political unrest in the Middle East, the US President’s proposal to impose tariffs on US steel imports, and the response of other countries to this, remains to be seen.
“All of this serves to underline how vulnerable shipping is to geopolitical influences. But the industry must take heart from its proven durability. Confidence breeds confidence, and confidence breeds success.”