Lauro (Scorpio Tankers) is not enthusiastic about the sudden increase of liquid freights
Fiori (Premuda) agrees that the consolidation in the sector is necessary “although nobody wants to be consolidated”
Montecarlo (Monaco) – Scorpio Tankers managing director Emanuele Lauro was not enthusiastic about the sudden increase in tanker charters caused by the sanctions imposed on Cosco’s VLCCs and by the storage of low sulphur fuel, but he was optimistic about market fundamentals.
“As concerns the impact of geopolitical factors on shipping, I believe that they are putting pressure on the market. The negative effect is caused by the public’s negative perception of the market trend and, being a listed company, we are affected by it.
Trump or the Cosco vicissitude contribute to the creation of a temporary volatility, while market fundamentals are good”, the shipowner observed before admitting that Medium Range and Long Range tankers are benefitting from the “cascading positive effect” of freights from ships with a greater capacity.
Also Lauro criticised the IMO with regards to the entry into force of the Low Sulphur Cap from the beginning of 2020, while M Sea Capital managing director Modi Mano acknowledged that at present technology “is the first concern for every shipowner. We are already thinking about the next regulation we will have to comply with”.
Premuda managing director Marco Fiori ascribed the liquid bulk recovery to a series of small factors, including also “shipyards building less ships, technologies making it more difficult for new operators to enter the market, a smaller number of shipbuilding hubs”.
As concerns the fact that the newbuildings market did not decrease significantly, Fiori added that “shipyards find it hard to be more efficient, also in light of the new technologies required by ships. Besides, we must consider also the current consolidation between shipyards, both in Japan and elsewhere. I believe that in the future shipowners will have less shipyards to apply to, and also production will be less diversified”.
Panellists agreed about the fact that the liquid bulk market is heading towards a gradual concentration: “Consolidation is the solution for this sector”, Fiori observed, adding that “everyone likes market consolidation, but nobody wants to be consolidated”.