Too Many Boats for Too Little Cargo Leaves Shippers High and Dry
- Hundreds of ships must be broken up, Clarksons Platou says
- Shares plunge along with ship prices, revenue and earnings
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Shippers of commodities are in the midst of an unprecedented crisis as waning Chinese growth and a surge in supply push earnings to new lows. These charts show how it happened, how commodity shipping is collapsing and how there’s one glimmer of hope for owners to turn things around.
In the mid-to-late 2000s ship owners gambled that China’s economy would continue to grow at about 10 percent a year. The result: the number of the largest commodity carriers, called Capesizes, has almost doubled since 2008. The fleet hit a record 1,655 vessels in early 2015 -- the same year in which the Chinese economy grew at the slowest pace in 25 years. Owners are now fighting for whatever market share they can get.