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Survey: Shipping confidence hits three-year high

The average confidence level in the shipping industry expressed by survey respondents rose to 6.1 out of 10 for the three months ending May 31, 2017, according to UK-based accounting and advisory company Moore Stephens.

   Confidence in the shipping industry equaled its highest rating in the past three years for the three months ended May 31, according to UK-based accounting and advisory company Moore Stephens.
   The average confidence level expressed by survey respondents was up to 6.1 out of 10 from the 5.6 recorded in the previous survey in February, Moore Stephens said Tuesday, adding that increased confidence was recorded across all main categories of the survey.
   “The survey launched in 2008 on the very cusp of one of the most protracted and severe global economic downturns, with a confidence rating of 6.8. In our latest survey, the figure stands at 6.1 which, given geopolitical, economic and industry developments, must be seen as a robust rating,” Moore Stephens Shipping & Transport Partner Richard Greiner said in a statement.
   “Moreover, confidence today of making a major new investment is the highest it has been for almost three years,” Grenier said. “The positive sentiment on freight rates is welcome, although this must be weighed against the lows to which they have fallen and from which they must continue to recover.”
   The confidence rating of brokers rose from 4.6 to 6.4, according to the survey, while for owners the increase jumped as from 5.6 to 6.1. Confidence on the part of charterers and managers, meanwhile, was up from 5.9 to 6.4, and from 6.0 to 6.2, respectively. Confidence levels were unchanged in Asia at 5.6, but up in Europe, from 5.5 to 6.2, and in North America, from 6.1 to 6.4.
   The likelihood of respondents making a major investment or significant development over the next 12 months was up from 4.9 out of 10.0 in the previous survey to 5.4, the highest level since August 2014. There was increased confidence on the part of all major respondents, in the case of charterers up to a level of 6.3 from 5.8 in February.
   Owners and managers, meanwhile, each registered a confidence level of 5.9, up from 5.1 and 5.6, respectively, last time. Confidence on the part of brokers was up from 3.4 to 4.4.
   Half of respondents said they expected finance costs to increase over the coming year, Moore Stephens said, down from 54 percent in the previous survey. However, more brokers and charterers anticipated costlier finance, with 63 percent of brokers, versus 41 percent last time, and 57 percent of charterers, compared to 47 percent in February.
   The number of respondents expecting higher rates over the next 12 months was up on the previous survey in all three main tonnage categories. In the tanker market, 32 percent of respondents anticipated improved rates, as opposed to 25 percent last time, while the number anticipating lower tanker rates fell from 28 percent to 16 percent.
   Meanwhile, there was a 14 percentage-point rise, to 58 percent, in the number anticipating higher rates in the dry bulk sector, the highest figure in three years.
   Regarding the containership sector, the number expecting higher rates rose from 31 percent to 46 percent, according to survey results, while there was a 6 percentage-point fall, to 12 percent, in those anticipating lower containership rates. Net sentiment was up in the tanker market from -3 in February 2017 to 16 this time, while increases in the dry bulk trade went from 33 to 50, and increases in the containership trade went from 13 to 34.
   “Our latest survey found many of our respondents in watchful mode, mindful of the fact that there are still too many ships, but encouraged to believe that increased demolition and more pragmatism by industry stakeholders will help to redress this imbalance,” Grenier said.
   “Respondents also remain cognizant of the impact which geopolitical developments can have on shipping, and it will be instructive to see what effect all this will have on industry confidence in our next quarterly survey,” he added.

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