Rough Seas for Asia-Pacific Shipping Industry
Pardon the cliche, but a nearly perfect storm of negative influences is lashing the Asia-Pacific shipping sector, and the outlook is decidedly dismal, according to Moody’s Investors Service in a new report on the industry.
Falling commodity prices, a global credit crunch and major economies in recession all are putting a squeeze on freight rates and profit margins.
Moody’s believes that such a situation will last for an extended period and, as a result, has changed the outlook of the three sectors in the shipping industry – dry bulk, tankers and liners – to negative from stable.
The global recession and resulting decline in demand for oil and consumer goods is hitting just as new shipping vessels are coming online. The imbalance is a key reason for the Asia-Pacific’s negative shipping outlook, Moody’s said.
In September, Moody’s put Taiwan shipper Wan Hai Lines Ltd on review for possible downgrade because of its greater reliance on the more volatile shipping conditions outside of Asia.
For details, see “Asia-Pacific Shipping Sector, Preparing for Volatile Times.”
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