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Demand/Supply in Shipping and Fleet Management
Shipping is very resilient and always recovers, but in different shapes and forms. Regrettably there will be casualties and a number of companies will not survive.
There has also been an increase in the number of ships being scrapped, or to be politically correct, “recycled”. This is possibly a good thing as it means in many cases that older tonnage is being removed as companies focus on what is their current and future business and the ships that they will need to meet these demands.
There is also the matter of updating older tonnage to meet new legislation and in particular environmental legislation. This is advancing at a pace which is quietly resulting in changes far beyond the environmental legislation.
In this year of 2020, there was a collapse in the movement of shipping and the cargoes that they carry. But as the world relies on shipping for the movement of raw materials and finished goods, this will eventually be resolved. The main victim of the COVID-19 pandemic has been the passenger ship sector.
Early on, there were the news media reports of passenger ships not being allowed to enter port and the passengers being held on board unable to depart and return home. That was bad enough, but at that time, no one was considering the crew and how they could not travel home and were captives on their own ships.
The COVID 19 global pandemic has had a terrible and ongoing effect on the world of shipping and its operations. The shipping industry as a whole is having to find solutions to many of the problems that have been highlighted.
The main result of this pandemic is that the way that business has been conducted in the past is no longer the way that business will be conducted in the future.
An example of this is that the Carnival Corporation is scrapping 18 ships across its 9 brands with figures set to rise due to the uncertainty on the market. Holland America has sold off 4 ships. Pullmantur Lines has scrapped 3 ships. And so, the list goes on. The deeper that you dig the more that comes to light. In a number of cases the ships scrapped were of an older age but still had a few years of life left but the pandemic accelerated their demise. Meanwhile, it has been reported that 52 containerships with a capacity of 94,000 TEU have been scrapped so far this year. A number of these are of the Panamax class which has been superseded by the expansion of the Panama Canal which really makes them redundant in the modern era. The pandemic just brought the date for scrapping forward. By 5 March 2020 at least 20 Capesize bulk carriers had been scrapped and many more have been added to this number. On the other hand, only 8 tankers have been scrapped in the first 8 months of 2020. In fact, more tankers are being delivered and the tanker fleet is growing.
This shows the disparity of fleets in respect of the pandemic. But what needs to be understood is the loss of passenger / cruise ships creates a large loss of crew numbers, whereas tankers have small crew complements and of course it is not easy to transfer from passenger ships to tankers. It will not be until 2021 before the full picture is apparent of how the shipping industry has adapted and changed to meet the new demands for ships types and services.
This will be under constant revision as the economies of the world adjust to their new position and finances after dealing with the pandemic. The demand for raw materials and finished goods will move downward as unemployment hits homes and the lack of disposable income becomes a major factor to be considered in predicting what people want and can afford.
Port calls, too, is a major responsibility. The central theme must be to keep the crew safe. While at sea the crew are in effect in a bubble. There is no interaction between the crew and others. This changes dramatically when the ship arrives in port. The degree of interaction will change extensively depending on the ship type and cargo that is being carried.
Ship Management Masterclass Seminar
The main focus of this course is about ship management and how it has been coping and adapting to new standards and demands. Through every discipline that is connected to ship management and through the topics covered, there will be an ongoing reference in every subject to COVID 19.
Another topic that will be coming into force after the 1st January 2021 is Cyber Security. This is going to be an endless battle and the companies making up the shipping industry will be fighting this and diverting resources to keep their image safe.
The problem is that the organisations can only win one battle at a time. They can never win the war unless there is a major shift in the cyber world.
This course is four hard days of concentrated study and every effort has been taken to make it informative and hopefully an enjoyable experience.
The timed breaks throughout each day have been made so that delegates are not diverted away from the course to deal with pressing work-related matters.
The timetable being presented has to be followed so that the full content of the course can be delivered and discussed and any issues resolved.
I can only wish everyone good luck and hopefully it will be a memorable four days and that the investment of your time and resources will have found the final outcome worth all of the effort.
One problem in delivering a course like this at these times is that the constant state of flux that the shipping industry finds itself in means that what is relevant today can be obsolete tomorrow. That is why it is more important to know where to find relevant and reliable sources of information that are regularly updated if not daily.
Finally, I want everyone to enjoy the course and that they take away from it what they were looking for. Learning should always be enjoyed not a stressed filled labour. The secret nowadays is not to know and be able to recite information, but knowing where to it and then apply it correctly to the situation that is under discussion or review.
Welcome to the course.
Capt. John Dickie
Managing Director, JDass Ltd
Former Secretary General,
International Federation of Shipmasters’ Associations (2012-2015)