Shipping summit: Caution tempers optimism as order books fill

A SPENDING spree is expected in 2011 as Asian carriers, fresh from a year of scrapping, order new ships as slow steaming absorbs capacity, Hanjin CEO Kim Young Min told Cosco`s World Shipping Summit in Guangzhou.

Korea`s Hanjin Shipping is in the market for mid-sized containerships because volume is expected to increase eight per cent on returning demand from US and Europe in the next year, said Mr Kim.


Bloomberg noted that Taiwan`s Evergreen has 10 ships on order as part of 100 with some in the 8,000 TEU class to add to its coming fleet of 20 same-size vessels worth US$2 billion ordered from Samsung Heavy Industries in June and Singapore`s NOL has 12 on order from Daewoo.


Yet a note of caution came from Tokyo`s Value Search Asset Management president Minoru Matsuno who warned conference delegates: "The industry needs to ensure it doesn`t repeat the overcapacity mistakes that helped hammer rates last year."


Cosco chairman Wei Jiafu agreed the shipping market is "roaring", but also said a "more rational mentality" is essential to avoid flooding the market with capacity and pushing down rates.