The Multipurpose & Heavy Lift Transportation Outlook 12 March 2014 Tina Liu

The Multipurpose & Heavy Lift
transportation outlook
12th March 2014
Tina Liu
By Drewry Maritime Research

oatway@drewry.co.uk
12th March 2014
Drewry | BreakBulk China 2014
Agenda
The Multipurpose and Heavy Lift Fleet

Cargo Demand
Competition
Outlook
Drewry 2014
Fleet definitions
Multipurpose vessel:
Dry cargo carrier
between 2,000 and 55,000 dwt
grain or bale AND container capacity
combined lifting gear with minimum 25-tonne SWL
Project carrier
multipurpose vessel built after 1989
with increased lifting capacity over or equal to 100mts
Premium Project carrier
Project carrier
with increased lifting capacity over or equal to 250mts
Source: Drewry Maritime Research
Drewry 2014
MPV fleet age profile as at January 1st, 2014

3,000
20,000
18,000
2,500
16,000
14,000
2,000
10,000
1,500
dwt
'000 dwt
12,000
8,000
1,000
6,000
4,000
500
2,000
0
1970
2-5,000
1973
1976
1979
5-10,000
1982
1985
10-15,000
1988
1991
15-20,000
1994
1997
2000
20-35,000
2003
2006
35,000+
2009
2012
Average dwt (RH axis)
Drewry 2014
MPV fleet age profile by vessel type as at January 1st, 2014

3,000
2,500
'000 dwt
2,000
1,500
1,000
500
0
1970
1973
1976
1979
1982
MPV
1985
Heavy Lift
1988
1991
1994
Project Carrier
1997
2000
2003
2006
2009
2012
Premium Project Carrier
Drewry 2014
Ship size development

Vessel
Gear
(tonnes)
Beam
(m)
Draft
(m)
Deadweight
SS Ancon
n/a
18
8.8
9,500
MPV
60
16.6
6.4
7,500
Project Carrier
160
20
8.2
13,000
Premium
project carrier
400
22.9
8.8
15,500
SS Ancon:
First official transit of the
Panama Canal, August 1914
Drewry 2014
Project carriers within the MPV fleet (000 dwt)
35,000+ dwt
Dwt Sector
20-35,000 dwt
15-20,000 dwt
10-15,000 dwt
5-10,000 dwt
2-5,000 dwt
-
1,000
2,000
3,000
Multipurpose
4,000
Heavy Lift
5,000
6,000
Project carrier
7,000
8,000
9,000
10,000
Premium Project carrier
Drewry 2014
Fleet development by vessel type (000 dwt)

3,000
Scheduled deliveries
2,500
2,000
1,500
1,000
500
Scheduled demolitions
2,500
0
2008
2009
2010
2011
Multipurpose Vessels
2012
2013
2014
Project carriers inc HeavyLift
2015
2016
2,000
1,500
1,000
500
0
2008
2009
2010
2011
2012
2013
2014
2015
2016
Drewry 2014
Slippage rates on actual MPV deliveries

4.50
50%
4.00
45%
40%
3.50
35%
million dwt
3.00
30%
2.50
25%
2.00
20%
1.50
15%
1.00
10%
0.50
5%
0.00
0%
2008
2009
2010
Scheduled delivery at beginning of year
2011
Actual delivery date
2012
2013
Slippage rate (RH axis)

Drewry 2014
10
Multipurpose fleet development to 2016 (000 dwt)

35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
2008
2009
2010
2011
2012
2013
2014
2015
2016
Drewry 2014
11
Suggested fleet development by vessel type (000 dwt)

3,000
25,000
2,500
2,000
20,000
1,500
1,000
15,000
500
0
10,000
-500
-1,000
5,000
-1,500
-2,000
PC deliveries (incl. HL)

MPV deliveries (not incl. PC)
-2,500
MPV demolitions (not incl. PC)

HL demolitions
2010
2011
2012
2013
2014
MPV fleet (not incl. PC, right axis)

PC fleet (incl. HL, right axis)
0
2015
2016
Drewry 2014
12
Agenda

Cargo Demand
Competition
Outlook
Drewry 2014
13
World economic growth (% change)

15.0
10.0
5.0
0.0
2009
2010
2011
2012
2013
2014
2015
-5.0
-10.0
-15.0
Real GDP
Trade in goods
Source: Drewry Maritime Research derived from IMF
Drewry 2014
14
Suggested development of dry cargo demand (million tonnes)

8,000
900
7,000
800
700
6,000
600
5,000
500
4,000
400
3,000
300
2,000
200
1,000
100
2010
2011
2012
2013
2014
2015
Total Dry Cargo
Total Bulk Cargo
Total Container cargo
MPV Market share (rh axis)
2016
Source: Drewry Maritime Research, GTIS, WTO
Drewry 2014
15
Suggested development of general cargo market (million tonnes)

2,000
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
2010
2011
2012
2013
Non Container/ General Cargo
2014
2015
2016
Total Container Cargo
Source: Drewry Maritime Research, GTIS, WTO
Drewry 2014
16
Demand drivers:
Global crude steel production (million tonnes)
2,500
2,000
CAGR
13-16
China
7.8%
EU-15
1.0%
India
6.9%
Total
5.8%
2010
2011
1,500
1,000
500
EU-15
USA
2012
Japan
2013
China
S.Korea
2014
Taiwan
2015
India
2016
Others
Drewry 2014
17
Development of MPV market share to 2015 (million tonnes)

8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
2010
Bulk cargo
2011
2012
MPV share of bulk cargo
2013
2014
General cargo
2015
2016
MPV share of general cargo
Drewry 2014
18
Agenda

Cargo Demand
Competition
Outlook
Drewry 2014
19
One year TC rates comparison ($ per day)

9,000
NEEDS UPDATING
8,500
8,000
7,500
7,000
6,500
6,000
5,500
5,000
May-12
Jul-12
Sep-12
Multipurpose (18,000 dwt)
Nov-12
Jan-13
Mar-13
Container (22,000 dwt)
May-13
Jul-13
Sep-13
Handysize (28,000 dwt)
Source: Drewry Maritime Research from brokers reports
Drewry 2014
20
Asset Prices
Indicative newbuilding prices (US$m)
Trend in secondhand prices (US$m)
40
35.0
35
30.0
30
25.0
25
20.0
20
15.0
15
10.0
10
5.0
5
0.0
0
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2003
2004
2005
MPP 10-20,000 dwt
25-30,000 dwt bulkcarrier
500 teu 8000 dwt container
2006
2007
2008
2009
Handysize 25,000 dwt
2010
2011
2012
2013
500 teu 8,000 dwt containership
17,500 dwt MPV
Drewry 2014
21
Agenda

Cargo Demand
Competition
Outlook
Drewry 2014
22
Supply Demand Balance

30.0
32.0
25.0
30.0
20.0
15.0
28.0
10.0
26.0
5.0
0.0
Growth in Fleet vs Growth in Demand (%)
24.0
2011
2012
2013
Cargo Tonnes per Effective Dwt
2014
2015
2016
10.0%
Effective Fleet Million Dwt (RH axis)

5.0%
Effective fleet vs Effective demand (million tonnes)

0.0%
2011
2012
2013
2014
2015
2016
-5.0%
-10.0%
-15.0%
-20.0%
Fleet growth
Demand growth
Drewry 2014
23
One year period rates for MPV ($/day)

10,000
9,000
8,000
7,000
6,000
5,000
4,000
3,000
2,000
2009
2010
2011
2012
4,000-4,999 dwt
2013
2014
2015
2016
15,000-19,999 dwt
Drewry 2014
24
Conclusions and challenges
Steady fleet development expected new investment

in eco designs and high spec vessels
Demand for the sector continues to grow for both
breakbulk and project cargo
Encroachment by competing sectors still evident
and unlikely to wane in the short term
Project cargo demand dependent on developing
economies
Drewry 2014
Drewry | Breakbulk China 2014
25
Thank You!
Drewry was founded in 1970 as a provider of
independent information and advice to the global
maritime industry. Since then we have worked
with over 4,000 clients in more than 100 countries.
We are privately owned with research and

advisory teams in London, Delhi, Singapore and
Shanghai.
London
Drewry
15-17 Christopher Street
London EC2A 2BS,United
Kingdom
T: +44 (0)20 7538 0191
E: info@drewry.co.uk
Singapore
Drewry
15 Hoe Chiang Road,
#13-02 Tower Fifteen
Singapore 089316
T: +65 6220 9890
E: singapore@drewry.co.uk
Delhi
Drewry
209 Vipul Square, Sushant Lok1 Gurgaon 122002, India
Telephone: +91 124 40476
31/32
E: india@drewry.co.uk
Shanghai
Drewry
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Tower,
201 Shi Ji Avenue,
Pudong District,
Shanghai, China 200120
T: +86 (0)21 6182 6759
Drewry 2013

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The Multipurpose & Heavy Lift

By Drewry Maritime Research

12th March 2014

Drewry | BreakBulk China 2014

The Multipurpose and Heavy Lift Fleet

Drewry | BreakBulk China 2014

Source: Drewry Maritime Research

Drewry | BreakBulk China 2014

MPV fleet age profile as at January 1st, 2014

Average dwt (RH axis)

Source: Drewry Maritime Research

Drewry | BreakBulk China 2014

MPV fleet age profile by vessel type as at January 1st, 2014

Premium Project Carrier

Source: Drewry Maritime Research

Drewry | BreakBulk China 2014

Ship size development

Drewry | BreakBulk China 2014

Project carriers within the MPV fleet (000 dwt)

Premium Project carrier

Source: Drewry Maritime Research

Drewry | BreakBulk China 2014

Fleet development by vessel type (000 dwt)

Project carriers inc HeavyLift

Project carriers inc HeavyLift

Drewry | BreakBulk China 2014

Slippage rates on actual MPV deliveries

Scheduled delivery at beginning of year

Source: Drewry Maritime Research

Drewry | BreakBulk China 2014

Multipurpose fleet development to 2016 (000 dwt)

Project carriers inc HeavyLift

Source: Drewry Maritime Research

Drewry | BreakBulk China 2014

Suggested fleet development by vessel type (000 dwt)

PC deliveries (incl. HL)

MPV demolitions (not incl. PC)

MPV fleet (not incl. PC, right axis)

Source: Drewry Maritime Research

Drewry | BreakBulk China 2014

The Multipurpose and Heavy Lift Fleet

Drewry | BreakBulk China 2014

World economic growth (% change)

Source: Drewry Maritime Research derived from IMF

Drewry | BreakBulk China 2014

Suggested development of dry cargo demand (million tonnes)

Total Dry Cargo

Total Bulk Cargo

Total Container cargo

MPV Market share (rh axis)

Source: Drewry Maritime Research, GTIS, WTO

Drewry | BreakBulk China 2014

Suggested development of general cargo market (million tonnes)

Non Container/ General Cargo

Total Container Cargo

Source: Drewry Maritime Research, GTIS, WTO

Drewry | BreakBulk China 2014

Source: Drewry Maritime Research