2010 marked another tumultuous year in the project cargo segment of the shipping industry. Our industry is suffering under the slow recovery from the economic crisis that started in 2008. The financial industry’s ability and willingness to fund industrial projects remains low level, although we hope we will see new projects come on stream, and therefore an increased demand for ocean transportation, by the third or fourth quarter.
Forecasts that crude oil prices will rise about 25 percent this year is encouraging news because this would lead to increased investment in oil exploration, and an increase in the mobilization of drill rigs. It also appears the container carriers are filling up their space with consumer goods, alleviating the competition for project carriers to major global hubs. This competition was intense when global demand for ocean transportation was at its lowest level at the height of the economic crisis.
We look for the financial sector to show confidence that the world economy is heading in the right direction, which should lead to a lot of funds being released for new projects. Global infrastructure development needs haven’t changed since 2008; the fulfillment of those needs was merely postponed a few years and now is even more urgent in some places than it was two years ago.
We see the market being driven by huge demand in China, India and South America, especially Brazil, for just about everything from nuts and bolts to power generating equipment — and everything in between.