Outlook of the dry bulk shipping market in the next 5 years
Chang, Yvonne Cai Ying
Date of Issue2016
School of Civil and Environmental Engineering
Maritime Research Centre
A comprehensive presentation on the outlook of dry bulk industry for the next 5 years with emphasis on the global economy, demand of the major bulk commodities, supply of the dry bulk carrier and the freight rate mechanism that contribute to the health of the dry bulk market. The research focuses on the past and present event of the market situation and forecast the future status quo of the market. The scope of the study is to concentrate on the 3 main countries; China, Eurozone and United States that influence a large portion of the global GDP, the 3 main major bulk commodity; coal, iron ore and grain trading trend as they represent almost 1/3 of the world seaborne trade, the supply of dry bulk carrier based on the various main sizes of dry bulk carrier as well as the freight rate mechanism. As the freight rate mechanism is triggered by demand and supply equilibrium, with demand being average but Baltic Dry Index rate still low, could imply that supply is the main issue causing the gloomy dry bulk market with low freight rates. To improve the condition of the dry bulk market, massive scrapping of vessel is recommended to reduce the oversupply in tonnage. This is likely to improve freight rates and minimize the losses from the daily incurred operating cost that ship owners are facing as current freight rates are unable to cover daily operating. The mentality of the ship owners should also change so that they will not order more ships whenever the freight rate increase by a little, but to wait for the market to reach its equilibrium.
Final Year Project (FYP)
Nanyang Technological University