Vessel over-supply will continue to dog industry

As the world looks anxiously to a brighter economic year than 2008, prospects appear none too rosy – clearly uppermost in the mind of Maersk Line CEO, Eivind Kolding, who took the helm of the European Liner Affairs Association on January 1. He succeeds Hapag- Lloyd’s Ulrich Kranich. The focus of the Brussels-based organisation for the year ahead is its newly established Value Data Exchange Information System as well as finalisation of the Consortia Regulation. ELAA represents a veritable ‘Who’s Who’ of the liner shipping industry, including the AP Moller-Maersk Group (Maersk Line and Safmarine), Mediterranean Shipping Company (MSC), the CMA-CGM Group, Hapag-Lloyd and Emirates Shipping Line. As to the outlook for the container liner shipping industry, marked last year by service discontinuations and/ or cuts, a new study by UBS Investment Research suggests excess containership supply will remain a factor. And even though a recovery in demand growth will be evident by 2010, such volumes will absorb excess laid-up capacity. UBS says effective containership supply growth, which takes into account vessel lay-ups and order cancellations, is likely to be around 11.8% and 9.6% in 2009 and 2010 respectively, demand growth anticipated at 1.2% and 6.3%.