A shipping recovery is on the horizon, according to the Investors Chronicle. After five years in the doldrums, those on the inside were reluctant to call a turn in the notoriously cyclical shipping industry. Conditions have, however, improved enough to cause a ripple of excitement in some quarters, and the Chronicle thinks “with some justification”. “There are indications that market sentiment is starting to improve,” said Johnny Plumbe, executive chairman at shipbroker ACM Shipping (ACMG). “The worst is over,” added Mark Williams, research director at Braemar Seascope. “Nobody is feeling irrational exuberance, but there are grounds for some cautious optimism for 2014.” And Clarkson’s (CKN) top number-cruncher, Jeff Woyda, told the publication recently there was “light at the end of the tunnel”. But, as Williams said, none are getting carried away. Several themes at play since the credit crunch are still washing through the system. Huge numbers of ships ordered during the boom years were still being built and hitting the seven seas as the west began navigating a series of damaging recessions. Freight rates and ship values plummeted, credit dried up and high-profile bankruptcies followed. Calling the turn is also made more difficult by the sheer complexity of the shipping industry, with myriad variables such as vessel size, age, range, cargo and sea route that affect freight rates. INSERT There are indications that market sentiment is starting to improve. – Johnny Plumbe
