WOW – 2011, what a year! Revolution, earthquakes, floods, Bin Laden, Gadaffi, Kim Jong Il, birth of the 7 billionth child, Wikileaks….
And so farewell to 2011. Needless to say, any attempt to talk the market up was doomed to failure as any positive new development was immediately countered by some doom merchant predicting total meltdown.
There is no doubt that 2011 was a tough year for the shipping industry, and there plenty of people around to tell you that 2012 will be even worse.
It’s for this reason that we at Spinnaker have decided to talk the market up.
After all, shipping is a cyclical business, so we know the good times will come again. Don’t forget that some folk kidded themselves into believing the last boom would not be followed by bust (not least the British Prime Minister). But, sure as eggs is eggs, it was and so it will be again. Okay, not overnight, but in spite of the gloom, some clouds do have silver linings.
There are plenty of positive things to be seen in the market. Shipping is incredibly busy transporting the vast majority of the world’s goods round the globe. World trade grew by 6.5% in 2011 and there’s no doubt that with rising populations and increasing prosperity in Asia, South America and Africa, cargo volumes will continue to rise.
One ray of hope is scrapping; over 20m tonnes had been scrapped by the end of the third quarter 2011 and steel prices and demand remain high. Good news for those countries with recycling facilities. May they laugh all the way to the bank.
As they say, “where there’s muck there’s brass”, “one man’s meat is another’s poison” and all that. To quote a gentleman called John Fredriksen: “When you talk about sentiment, it is a strange feeling because we have had a good market for almost 10 years. Personally I am not that bothered about the crisis because we have seen it coming for the last three years. I would say it is just a question of time. We are just waiting and I look at this current situation as a new opportunity.” Admittedly, that was back in May!
