Containership Markets
Outlook
Marsoft, February 2005
Agenda
• Liner & Charter Markets: Recent
Developments
• Outlook: Trade and Fleet Fundamentals
• Base Outlook and Risk Assessment
Liner Markets
• Liner profitability soars in 2004
–
–
–
–
Record-high freight rates
Shipments expand by double-digit figures
Port congestion ties-up vessel capacity
Bunker and port-delay related surcharges mitigate
surging OPEX
• Forecast is less optimistic
– Capacity added in 2nd half of 2004 (with much more yet
to come) is a major concern, especially if port congestion
proves to be less of an issue in 2005
USD/ TEU
Liner Market Freight Index vs. Fleet Utilization
1600
100%
1500
95%
1400
90%
1300
85%
1200
80%
1100
75%
1000
Index for 2004 q4:
Preliminary Estimates
Sources: Marsoft, CI on Line
900
95q1
70%
65%
96q1
97q1
98q1
99q1
Rate Index (East-West trades)
00q1
01q1
02q1
03q1
Fleet Utilization for Vessels over 3000 TEU
04q1
Background: GDP and Trade Growth
• World GDP at 30-year high in 2004
• Base trade growth revised higher for 2004
and for 2005
– Surprising economic growth outside the major-OECD areas,
particularly in South-East Asia
– Strong growth in north-south and regional trades
(particularly intra-Asia)
– China the beneficiary
• Charter markets near full utilization
Charter-vessel utilization
approaches full capacity, as trade
growth continues to be strong
105%
100%
Utilization Index
95%
90%
85%
80%
75%
70%
65%
99q1 00q1 01q1 02q1 03q1 04q1 05q1 06q1 07q1 08q1 09q1
Oct. '04 Base Forecast
Jan. '05 Base Case
Agenda
• Liner & Charter Markets: Recent
Developments
• Outlook: Trade and Fleet Fundamentals
• Base Outlook and Risk Assessment
World Economy, Trade Growth,
and the Role of China
Global Developments
Annual Trade
Growth
Annual GDP
Growth
Trade to GDP
Ratio
Chinese Export
Growth (annual shipments)
Hist. Average (1996-2001)
7.2%
3.2%
2.3
15%
2002
2003
12.2%
13.0%
2.6%
3.5%
4.7
3.7
37%
33%
2004
14.5%
4.8%
3.0
30%
Base Case Forecast 2005
Base Case Forecast 2006
Base Case Forecast 2007
Base Case Forecast 2008
10.7%
8.2%
10.0%
8.4%
3.9%
3.3%
3.8%
3.5%
2.7
2.5
2.6
2.4
20%
14%
14%
12%
Trade Outlook:
Base, Low & High Cases
Base Case
Total
Trade
Chinese
Exports
2002
12.2%
37%
2003
13.0%
33%
2004
14.5%
30%
2005
10.7%
2006
8.2%
Low Case
High Case
Total
Trade
Chinese
Exports
Total
Trade
Chinese
Exports
20%
8.5%
15%
13.4%
26%
14%
6.2%
12%
10.5%
20%
Orderbook as a Percentage of Fleet:
No Slowing Down
90%
80%
70%
Percentage
60%
50%
40%
30%
20%
10%
0%
01q1
02q1
03q1
04q1
Cellular Vessels Under 3000 TEU
05q1
06q1
07q1
Cellular Vessels Over 3000 TEU
08q1
09q1
Total Cellular Fleet
Cellular Deliveries
(Base Case)
600
500
Thousand TEU
400
300
200
100
0
01q1
02q1
03q1
04q1
05q1
Deliveries, Cellular Vessels Under 3000 TEU
06q1
07q1
08q1
Total Deliveries, Cellular Fleet
09q1
Fleet Growth, Annual Basis
Base Case (container capable fleet)
Fleet Growth (from previous year)
Cellular & Non-Cellular Vessels
trading in container trades
30%
Increase on Year Ago
25%
20%
15%
10%
5%
0%
01q1
02q1
03q1
04q1
100-3000 TEU
05q1
Total Fleet
06q1
07q1
Panamax & Post-Panamax
08q1
09q1
Agenda
• Liner & Charter Markets: Recent
Developments
• Outlook: Trade and Fleet Fundamentals
• Base Outlook and Risk Assessment
Alternative Scenarios
• Low Case
– Low Case considers the impact of US economic
slowdown
• High Case
– High Case assumes continued Asian economic
boom and high Chinese export growth
Liner Market Outlook:
Fleet Utilization
105%
100%
Utilization Index
95%
90%
85%
80%
75%
70%
65%
99q1
00q1
01q1
02q1
03q1
04q1
Containerships over 3000 TEU
05q1
06q1
07q1
08q1
09q1
Total Containership Capable Fleet
TC Rates,
Geared 1000 TEU
24,000
22,000
TC Rates
1000 TEU, Geared
20,000
.
18,000
USD/ Day
16,000
14,000
12,000
10,000
8,000
6,000
4,000
01q1
02q1
03q1
04q1
Low Case
05q1
Base Case
06q1
07q1
High Case
08q1
09q1
Long-Term Perspective
Geared 1000 TEU
24,000
22,000
TC Rates
1000 TEU, Geared
20,000
.
18,000
USD/ Day
16,000
14,000
12,000
10,000
8,000
6,000
4,000
93q1 94q1 95q1 96q1 97q1 98q1 99q1 00q1 01q1 02q1 03q1 04q1 05q1 06q1 07q1 08q1 09q1
Low Case
Base Case
High Case
TC Rates,
Gearless 2000 TEU
44,000
40,000
TC Rates
2000 TEU, Gearless
.
36,000
USD/ Day
32,000
28,000
24,000
20,000
16,000
12,000
8,000
4,000
02q1
03q1
04q1
05q1
Low Case
06q1
Base Case
07q1
High Case
08q1
09q1
Vessel Values:
History & Forecast
100
90
80
Million USD
70
60
50
40
30
20
10
0
80.1
82.1
84.1
86.1
88.1
90.1
NB 4500 TEU
92.1
94.1
96.1
NB 2000 TEU Grlss
98.1
00.1
02.1
04.1
SH10 2000 TEU Grlss
06.1
08.1
Long-Term Perspective
Gearless 2000 TEU
44,000
40,000
TC Rates
2000 TEU, Gearless
.
36,000
USD/ Day
32,000
28,000
24,000
20,000
16,000
12,000
8,000
4,000
93q1 94q1 95q1 96q1 97q1 98q1 99q1 00q1 01q1 02q1 03q1 04q1 05q1 06q1 07q1 08q1 09q1
Low Case
Base Case
High Case