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REVIEW | ON THE OCEAN: PART ONE


TURNING THE TIDE


In a two-part feature, HLPFI looks back on the changing face of the multipurpose shipping market since the magazine was first published in 2007.


BY DAVID KERSHAW M


any words could be used to sum up the past ten years of project cargo shipping. Perhaps “uncertainty” is one that has most often been


employed by industry executives and HLPFI as we have tried to summarise the state of the business over recent years. HLPFI launched its first Ships & Shipping Lines supplement in 2011, which introduced a number of topics that have continued to shape the sector, including pressure on rates as container, ro-ro and bulk lines seek a piece of the project cargo pie, nervous times in the semi-submersible market, tumbling demand and an oversupply of tonnage combining to force rates down and play havoc with margins, plus the growing threat of piracy. Drewry’s lead analyst for multipurpose


shipping, Susan Oatway (pictured right), commented in 2011: "Competitive threat is a major concern for the multipurpose sector, but reacting in an innovative manner, which we can see happening already within the project cargo arena, is how carriers are going to capitalise on market conditions.” In 2012, Oatway continued to analyse the growing


trend towards containerisation of project and breakbulk cargoes. “A number of the major lines have invested in open top or flatrack containers, designed specifically to carry the heavy, awkward cargoes that used to be the preserve of the project carrier fleet. Lines have told us they are aggressively marketing this service.” Tis aggressive marketing has continued until today, as


18 | HLPFI10


container rates have fallen to record lows and lines have looked for alternative cargoes to boost revenues. But container shipping has been subject to its own shift, with consolidation resulting in a significantly altered industry now than we saw ten years ago. With the turn of the century, the multipurpose shipping sector was about to experience a 'golden decade' with global economic growth driving a surge in demand for heavy lift and project cargo transportation services. However, the economic slowdown post-2008 and the subsequent hostile operating environment has resulted in a multipurpose sector that is today almost unrecognisable from the heydays of the mid-2000s.


Behaving themselves In 2011, HLPFI wrote that “the heavy lift shipping boys and girls need to start behaving themselves, and fast”. We added: “Investors with short-term shipping interests are skewing a sector where hefty mortgages and steep operating costs are set against a turbulent backdrop of overcapacity,


and a market at best jittery, at worst shrinking or stalled.” Tese are themes that have continued to pervade the sector


for the past ten years, and there have been casualties along the way. It remains to be seen whether the industry will learn from its past mistakes if it enters a period of recovery in the next decade, but there is no doubt that this is an industry that has proved itself resilient in the face of adversity. In the first edition of HLPFI, published in November


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