Shipbuilding Forecast Club Selected Highlights. Spring 2017

Transcription

1 Shipbuilding Forecast Club Selected Highlights Spring 2017

2 About the Shipbuilding Forecast Club What are the aims? To provide market intelligence, forecasts, analysis, education and networking opportunities to companies selling into the shipbuilding and shipping market to support their sales, marketing and strategic planning needs. The key deliverables are a detailed market report presented at a six monthly seminar. What is covered? Freight market review and outlook In depth newbuilding market analysis Newbuild contracting forecasts to 2026 by 66 segments; fleet growth forecasts to 2029 Equipment and financing requirement forecasts to 2027 Trade forecasts and regional trading patterns If you are interested in attending the Shipbuilding and Shipping Forecast Club, please contact Clarksons Research (see page 26 for details). Ownership trends and forecasts Environmental & regulatory review Who should attend? Any entity selling and marketing into the shipbuilding and shipping market, be that yard space, marine equipment, class or flag services, aftersales support, insurance or finance. Any company needing to understand the shipping and shipbuilding markets, the latest major themes and trends and their outlook to Next seminar 27 th September See page 26 for more details on the Club. 2

3 Spring 2017 Seminar Highlights Please note that these highlights are provided for illustrative purposes only and some information has been redacted.

4 Key Takeaways 1. Bottom of market cycle. Possibly some of the toughest years in 2016 since financial crisis for shipping but now some building blocks for the future. Oversupply after ordering in 2010 and 2013 but some improvements in bulker markets and very strong investor interest, tankers OK in 2016 but now easing back. Huge pressures built up container market across 2016 but perhaps past bottom on freight, major stress across offshore driven by oil price collapse. Better markets in some niches (Cruise, Ferrry, Ro Ro). 2. Trade Growth. Still Growth potential in Seaborne Trade but Offshore requirements weak in short term. Trade impacted by Chinese economy and policy (one belt, one road). But still 85% of trade by sea and still long term growth potential despite range of scenarios. Offshore driven by different fundamentals and structurally longer to recover. 3. Fleet Growth Slowing. But still 50% bigger than after financial crisis so larger market for service sector. Deliveries declining in 2017 and an accelerated decline in 2018 and 2019 expected. Lower fleet growth in 2017 and in medium term and consolidation of client base expected. 4. Shipyard Orders Drought. Shipyard ordering very weak in 2016 and pressures building for further consolidation and capacity reductions. Non-delivery of orderbook continues. Weakest ordering since 1980s in 2016 continued weakness in 2017 anticipated with focus on small and niche (passenger not offshore). Some speculative investment now expected in 2017 however. 5. Major change in financial landscape including regulation and banks exiting shipping. 6. Environment & Technology Change. Regulation accelerating and creating demand for solutions. Technology and innovation opportunities with e-commerce, data, IT and satellite communication to ships to support productivity and regulation. 4

5 Jan-08 Jun-08 Nov-08 Apr-09 Sep-09 Feb-10 Jul-10 Dec-10 May-11 Oct-11 Mar-12 Aug-12 Jan-13 Jun-13 Nov-13 Apr-14 Sep-14 Feb-15 Jul-15 Dec-15 May-16 Oct-16 Shipping Since the Financial Crisis US$ 000/day The ClarkSea Index, 2008-Present Annual Average ClarkSea Index (US$/day) OPEX Index (US$/day) ,659 6, ,331 6, th US$10,701/day ,480 6, ,314 6, ,577 6, ,263 6, ,743 6, ,410 6,397 Data provided as part of Shipbuilding Forecast Club ,441 6, * 9,675 6, * = year to date Note: OPEX Index basis Moore Stephens published statistics, weighted using ClarkSea assumptions. 5

6 Cycle Position: This chart shows average earnings for each ship type, compared to the average earnings since January 2009 ClarkSea Index VLCC Suezmax Aframax Clean Products (MR) SS Chem Tanker 20k dwt Capesize Panamax Handymax Handy Container 6,800 teu Container 4,500 teu PCC 6,500 ceu Ro-Ro 3,500 lm ClarkSea Index relatively low Containership rates improving but still in the doldrums, PCC weak, Ro Ro firm Tanker markets coming off after great 2015 and OK 2016 Bulkcarrier rates showing some improvement & lots of investor interest LPG LNG Offshore - Jackups Offshore - Floaters Offshore - PSV Note: Current position based on March to date average. -100% -80% -60% -40% -20% 0% 20% 40% 60% % deviation from average LPG and LNG sectors weak Offshore sector very weak 6

7 Jan-96 Jul-96 Jan-97 Jul-97 Jan-98 Jul-98 Jan-99 Jul-99 Jan-00 Jul-00 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Monthly Newbuild Contracts by Number Reported Shipbuilding Orders Per Month No. Vessels 1, : Only 500 orders placed - record low from perfect storm of all major freight markets being weak, over ordering in 2013 (private equity / eco) and 2015 (Tier III), financing conditions, yard pricing and very weak sentiment. Oil price impacting offshore Feb 1999: 18 orders May 2009: 23 contracts 2016: Lowest number since 1980s 7

8 Bulkcarriers Historically Low Ordering Sector Focus: Capesize: 33 orders +14% y-o-y Panamax: 2 orders -98% y-o-y Handymax: 7 orders -94% y-o-y Handysize: 6 orders -95% y-o-y Just 48 bulkcarriers were ordered last year. Contracts were generally backed by long-term charter, with very few speculative orders. More bespoke designs including 31 Valemax orders. Despite record low newbuild prices, lower resale values meant that speculative activity was focussed on the secondhand market in

9 Sector Focus Cruise Ships 9

10 Cruise - Major Brands (60,000+ GT ships) Fleet Orderbook New Orders Group Brand No. Berths No. Berths (f) 2018 (f) Carnival 25 65, , , , , , , , , ,286 Other 13 28,943 1 Royal Caribbean (includes joint venture with TUI) 23 70, , , , ,288 Other 3 10, ,760 Norwegian 14 38, , ,502 More detailed projections provided as part of Shipbuilding Forecast Club MSC 12 30, ,480 2 Disney 4 8, ,000 2 Genting 1 1, , , , , ,364 All Other 2 3, ,400 3 Total , ,

11 Historical Shipbuilding Shares (GT) % Global Deliveries USA US Other Countries Korea China Europe Japan Japan 11

12 Clarksons Newbuilding Price Index Guide Newbuilding Prices* VLCC: $81m Capesize: $42m 18.5k TEU boxship: $145.0m 174k m 3 LNG unit: $193m *as of 01/03/

13 Focus - Rest of the World Ordering Azerbaijan: 4 orders USA: 5 orders 2 x Ro-Ro 2 x 8,000 dwt chemical tankers 3 x AHTS 2 x 3,500 TEU containerships Vietnam: 17 orders of 0.2m CGT 3 x 50,000 dwt handy products tankers 3 x 6,500 dwt chemical tankers 2 x MPP 2 x passenger ferries 7 x transport (heavy lift) Taiwan: 4 orders 4 x feeder boxships at CSBC Philippines: 2 orders 2 x 115,000 Aframax crude tankers Chile: 1 order 1 x 210 berth cruise ship Indonesia: 2 orders 2 x 6,500 dwt product tankers Brazil: 2 orders 2 x 16,316 HP AHTS India: 4 orders 4 x passenger ferries (2 x 1,200 pax, 2 x 500 pax) Bangladesh: 1 order 1 x 581 cu.m. LPG carrier Total Other World Orders = 44 ships of 0.61m CGT Australia: 2 orders 2 x passenger ferries 13

14 Consolidation Potential Vessels > 2,000 DWT/GT: Consolidation Potential? Major Owner Clusters Company Size Very Small (1-5) Small (6-10) Medium (11-20) Large (21-50) Very Large (51-100) No. Companies % Fleet (No. Vessels) % Fleet (GT) Detailed breakdown of ownership statistics provided as part of Shipbuilding Forecast Club Ships per Company m GT China Greece Japan Germany United States XXL (100+) 40 Total 20 *Start of Year x% of tonnage owned by public listed companies (includes oil 0 companies & cargo interest). x% owned by private. Hamburg 4th largest shipping cluster globally. Note: Based on Beneficial Owner, excludes unknown owners, company size based on overall world fleet including small ships (< 2,000 DWT/GT). Above covers 40,000 ships of 1.2 bn dwt. 14

15 Top Owner Zones Top 20 Owner Zones (million GT) Athens Tokyo Singapore Hamburg Hong Kong Seoul Imabari Shanghai London Hamilton Copenhagen Taipei Oslo Monte Carlo Geneva New York Istanbul Antwerp Kuala Mumbai Sector by sector analysis of shipowning clusters around the world Owners based in the top 10 owner zones account for a combined fleet of 646m GT, representing 52% of the total fleet. Owners based in the top 20 owner zones control 823m GT, accounting for two thirds of world capacity. Athens is by far the largest owner zone, with companies based here controlling a combined fleet of xm GT. The second largest zone is Tokyo (xm GT) followed by Singapore (xm GT) and Hamburg (xm GT). Owner Zones are defined as areas of a 40km radius around major shipping cities. All zones have a cumulative fleet of over 1 million GT. Data is based on the recorded location of the beneficial owner, defined as the ship owning company with the main commercial responsibility for the ship

16 Significant change in financial landscape China Development Bank SMBC RBS EksportKreditt HSBC Deutsche Bank Bremer Landesbank Danske Bank Commerzbank (ex-dsb) Danish Ship Finance ING Bank Standard Chartered Bank of America ML SEB DBS Bank HSH Nordbank AöR KDB Unicredit Swedbank SocGen CIB Santander JBIC CIT Group Commonwealth Bank of Australia Piraeus Bank The National Bank of Greece Alpha Bank CIC Helaba DekaBank Portfolio Size July 2016 ($bn) Shipbuilding Forecast Club includes investment forecast up to 2027 Source: Clarksons, Marine Money, Petrofin, Industry Sources 1. Significantly fewer European ship finance banks. No KG today. 2. Increasing regulation 3. More conservative terms 4. More export credit and leasing (especially China) 5. Private equity investment but not now 6. Capital markets window largely closed in 2015 and Market stress and restructuring including for recent loans and offshore 8. Weak financing activity in 2016 to date 9. 1 yr TC on balance sheet 16

17 Seaborne Trade: Long-Term Scenarios Long-Term Seaborne Trade Scenarios 18,000 16,000 14,000 12,000 10,000 mt Base Case Low Case High Case Multiple trade scenarios modelled as part of Shipbuilding Forecast Club 8,000 6,000 4,000 International Transport Forum Transport Outlook 2017 (OECD/ITF): Sea freight transport demand growth % per annum 2,000 0 Source: Clarksons Research 17

18 Environmental Regulation Timeline Baltic Sea ECA in effect North Sea ECA in effect EEDI for newbuildings formally adopted North American ECA entered into force EEDI & SEEMP Mandatory (Phase 0) US Caribbean ECA enters into force Lower EEDI reference line (Phase 1) EU Monitoring, Reporting & Verification MRV becomes mandatory in EU ports MRV certification comes into force Lower EEDI reference line (Phase 2) Lower EEDI reference line (Phase 3) Date Global NOx Tier I Limit 1.0% ECA Sulphur Limit Global NOx Tier II Limit 3.5% global sulphur limit 0.1% ECA Sulphur limit Ballast Water Convention ECA NOx Tier III emission limit takes effect* Ratification of Ballast Water Management Convention Ballast Water Convention enters into force Hong Kong Convention Potential entry into force of Hong Kong Convention 0.5% global sulphur limit Key North Sea & Baltic Sea to be adopted as NOx ECAs *At the MEPC 66 it was decided that, as of 1st September 2015, Tier III limits within future ECAs will only apply to ships built after the date of adoption of the ECA, or a later date as may be specified in the amendment designating the NOx Tier III ECA. SOx NOx MRV ECA EEDI 18

19 Update: BWMC Retrofit Demand Scenario Not every vessel in the fleet will be retrofitted with a BWMS, retrofit demand depends on a number of factors including market conditions, vessel type and age and trading patterns. Scenario Assumptions: Exclude BWMS equipped ships (including allowances for late reporting) Scenario: How Many Vessels Need to be Retrofitted? No. Ships 100,000 90,000 Exclude domestic trading ships proxy for units operating in same risk area Exclude vessels of x+ years as the economics do not support retrofit, these ships are potential scrap candidates. Lower age of x+ years in certain sectors. 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 Shipbuilding Forecast Club includes analysis of ballast water retrofit demand, LNG capable fleet scenarios and SOx scrubber demand. 0 Global Fleet BWMS Equipped Domestic Trading Scrap Potential Projected Demand 19

20 Ship nos Contracting Forecast (Ship Nos) Long-Term Contracting Number of contracts projected to remain 6,000 5,000 4,000 History Grand Total Contracting Small Ships Forecast subdued in short-term, rising to x in Contracting remains below the historical average throughout the forecast period, significantly below the average throughout the forecast period in terms of both number of ships (on average down x%) and GT 3,000 2,000 1,000 hist avg Forecast broken down by 66 shiptypes and size sectors in number, dwt, $. Delivery and fleet growth forecasts are also available. (x%). Overall contracting forecast at an average of x p.a. in number terms, down x% compared to Autumn Product mix changing in long-term. 0 20

21 More Information about the Club

22 Shipbuilding & Shipping Forecast Club Membership The Shipbuilding Forecast Club provides a tailored shipbuilding research service for those who need more in-depth knowledge, analysis and forecasts about the shipbuilding industry. Aims: Market Intelligence Analysis and Marketing Education Research Forecasts Networking Membership Includes: Regular market intelligence Regular market forecasts and monitoring Bi-annual seminars including intelligence, education and networking Ad hoc support and telephone hotline 22

23 Shipbuilding Forecast Club Membership Seminars twice a year Review of the newbuilding market Newbuilding Forecasts ( ) - Forecasts are generated for 66 ship types and size-ranges Trends in key shipping segments Newbuilding broker expert panel Discussion and exchange of views Networking opportunities 23

24 Report Contents 24

25 Focus Sessions Container Focus Development of Chinese Shipbuilding Development of Chinese Economy LNG Overview LNG Shipbuilding Offshore Focus Containerships with focus on very large designs Cruise Industry New Entrants, Clusters and Growth Companies Public Shipping Companies Small Ship Market Propulsion Container Recovery FPSO focus Rationale of 18,000 TEU Regulatory Agenda Naval, Superyacht and Fishing Market LNG Newbuild Order Potential Global Shipbuilding Capacity Smart Shipping Environmental + Regulatory Update 25

26 Shipbuilding Forecast Club Membership Shipbuilding Forecast Club Monthly Update: Monthly Newsletter looking at recent contracting activity by ship type and builder country in addition to developments in newbuilding prices, currencies and interest rates Monthly Contracting Overview - Complete list of new orders, options and rumoured contracts - Summary of contracting by ship type and country Monthly Non-Delivery Monitoring - Summary of Slippage and Cancellation trends by ship type and country 26

27 Shipbuilding Forecast Club Membership Membership spans a variety of sectors including: Shipyards (6) Engine Manufacturers (9) Paint Suppliers (5) Classification Societies (3) Marine Equipment Suppliers (12) Government/Trade Associations (4) Financiers (5) Insurers (2) 27

28 Contacts At Clarksons Research For more information on pricing and membership to the Shipbuilding & Shipping Forecast Club please contact us for more information. Information on Clarksons Research s offshore focus multi-client group available on request. Stephen Gordon Managing Director Tel: +44 (0) stephen.gordon@clarksons.com Alex Springer Shipbuilding and Fabrication Group Tel: +44 (0) alex.springer@clarksons.co.uk 28

29 The next meeting of the Shipbuilding Forecast Club will be held on Wednesday 27 th September The next Offshore Forecast Club meeting will be held on Thursday 28 th September. Please note that a Spring 2017 update of the attached content is available through membership of the Shipbuilding Forecast Club. 29

30 Disclaimer The material and the information (including, without limitation, any future rates) contained herein (together, the "Information") are provided by CLARKSON RESEARCH SERVICES LIMITED ("Clarksons Research") for general information purposes. The Information is drawn from Clarksons Research database and other sources. Clarksons Research advises that: (i) any Information extracted from Clarksons Research database is derived from estimates or subjective judgments; (ii) any Information extracted from the databases of other maritime data collection agencies may differ from the Information extracted from Clarksons Research database; (iii ) whilst Clarksons Research has taken reasonable care in the compilation of the Information and believes it to be accurate and correct, data compilation is subject to limited audit and validation procedures and may accordingly contain errors; (iv) the provision of the Information does not obviate any need to make appropriate further enquiries; (v) the provision of the Information is not an endorsement of any commercial policies and/or any conclusions by Clarksons Research and its 'connected persons', and is not intended to recommend any decision by the recipient; (vi) shipping is a variable and cyclical business and any forecasting concerning it may not be accurate. The Information is provided on "as is" and as available basis. Clarksons Research and its connected persons make no representations or warranties of any kind, express or implied about the completeness, accuracy, reliability, suitability or availability with respect to the Information. Any reliance placed on such Information is therefore strictly at the recipient's own risk. This Information is confidential and is solely for the internal use of the recipient. Neither the whole nor any part of the Information may be disclosed to, or used or relied upon by, any other person or used for any other purpose without the prior written consent of Clarksons Research. Especially, the information is not to be used in any document for the purposes of raising finance whether by way of debt or equity. All intellectual property rights are fully reserved by Clarksons Research, its connected persons and/or its licensors. To the extent permitted by law, Clarksons Research and its connected persons shall not be liable to the recipient or any third party for any loss, liability or damage, cost or expense including without limitation, direct, indirect, consequential loss or damage, any loss of profit, loss of use, loss of or interruption in business, loss of goodwill, loss of data arising out of, or in connection with, the use of and the reliance on the Information whether in contract, tort, negligence, bailment, breach of statutory duty or otherwise, even if foreseeable. These exclusions do not apply to (i) death or personal injury caused by the negligence of Clarksons Research and its connected persons or (ii) the liability of Clarksons Research and its connected persons for fraud or fraudulent misrepresentation. In this disclaimer 'connected persons' means, in relation to Clarksons Research, its ultimate holding company, subsidiaries and subsidiary undertakings of its ultimate holding company and the respective shareholders, directors, officers, employees and agents of each of them. This disclaimer shall be governed by and construed in accordance with English law. CLARKSON RESEARCH SERVICES LIMITED, COMMODITY QUAY, ST. KATHARINE DOCKS, LONDON, E1W 1BF 30