Ship order secrecy could tip supply and demand balance, says analyst

Ship order secrecy could tip supply and demand balance, says analyst There could be far more containerships, be them very large containerships (VLCS) or more modest Panamax versions, on order than is currently known about due to the “wind of secrecy sweeping the container shipping world” according to French analysts AXS-Alphaliner.
   The Paris company said that getting information on newbuilds has become increasingly more difficult over the last 12 months or so as contracts have become cloaked in privacy clauses. Data nowadays only drips out from listed shipyards or via errant press releases, AXS-Alphaliner said.
   “The times when carriers (and shipyards) were proud of announcing new orders for big ships are clearly over. This renders difficult the reliable assessment of the future supply, especially for years as far as 2010 or 2011,” AXS said in its weekly newsletter.
   The analyst warned that the lack of complete data will lead to an understatement of future capacity, and consequently a potential rush for ships that will tip the supply and demand balance.
   “Keeping a veil of secrecy on orders will keep forecast figures foggy, probably leading to understatements of future fleet capacity. Since future supply is used in the decision process in ordering, underestimated figures could lead to more orders than reasonable, with at the end of the day difficult times to fill all the leviathans to come.”
   AXS-Alphaliner’s records show that 100 orders of VLCS have been placed during the past five months and that as of Oct. 1, the cellular ship orderbook reached a new high of 6.58 million TEUs, representing 62 percent of the existing fleet.
   “Given the secrecy surrounding orders in today competition climate, it cannot be excluded that a few carriers have booked their own series without info leaking. Further whole series of 12,500-TEU to 13,500-TEU ships are indeed known to be in the pipeline.”
   Not taking into account possible hidden orders, AXS-Alphaliner’s fleet forecast and annual growth (assuming no scrapping after Oct. 1) is:
   * Jan. 1, 2008: 4,361 ships for 10.97 million TEUs (up 14.5 percent during 2007).
   * Jan. 1, 2009: 4,848 ships for 12.58 million TEUs (up 14.7 percent).
   * Jan. 1, 2010: 5,252 ships for 14.29 million TEUs (up 13.7 percent).
   * Jan. 1, 2011 : 5,551 ships for 16.03 million TEUs    (up 12.2 percent).