Ten years after, shipping industry confidence holds firm

Shipping confidence held steady in the three months to end-May 2018 according to the latest Confidence Survey from international accountant and shipping adviser Moore Stephens.

The average confidence level expressed by respondents was unchanged at the four-year high of 6.4 out of 10.0 recorded in February 2018. Confidence on the part of owners was also sustained at a four-year high, of 6.6, while managers’ confidence was up from 6.4 to 6.7. The rating for charterers was up to 6.7 from 5.0 and confidence in the broking sector was up from 6.1 to 6.3. The survey was launched in May 2008 with an overall rating for all respondents of 6.8.

The likelihood of respondents making a major investment or significant development over the next 12 months was down on the previous survey from 5.5 to 5.2 out of a maximum possible score of 10.0. Confidence was highest among charterers, followed by owners (down from 5.9 to 5.5), managers (down from 5.6 to 5.4) and brokers (down from 4.0 to 3.5).

The number of respondents who expected finance costs to increase over the coming year was down to 63% from 64% last time. Whereas, in the previous survey, charterers were unanimous in expecting finance costs to increase, just a third were of that opinion this time.

The number of respondents expecting higher freight rates in both the tanker and container ship sectors was up, from 39% to 50% and from 38% to 43% respectively. In the dry bulk trades, such expectations were unchanged at 54%. Net sentiment in the tanker sector was +41, in the dry bulk trades +43, and for container ships, +32.

When asked to estimate the level they expected the Baltic Dry Index (BDI) to reach in 12 months’ time, 42% of respondents anticipated a figure of between 1500 and 1999, compared to 25% a year ago. Meanwhile, 36% put the likely level at between 1000 and 1499, contrasting with 52% a year ago.

Richard Greiner, Moore Stephens partner, Shipping & Transport, says, “It is two years since our survey reflected any decline in confidence. Net freight rate sentiment was significantly up in all the main tonnage categories. Shipping still has problems to overcome, but it continues to punch above its weight in terms of optimism.”

The survey was launched in 2008 just months before the Lehman Brothers bankruptcy which was to trigger a protracted global financial recession. Shipping markets were buoyant at the time, with an average confidence level of 6.8 out 10.0.

Over the past ten years, confidence averages out at 5.8 out of 10.0. The low point was the 5.0 out of 10.0 recorded in February 2016, since when it has only improved or been maintained. The 2010 financial crisis in Greece may have been a prime factor in the fall in confidence to 5.3 in August 2011, but thereafter began a period of fluctuation before a gradual recovery beginning in 2016 which appears not to have been affected by the birth of Brexit that year.

Over the life of the survey, demand trends have been the factor deemed most likely to affect performance, identified by an average 24% of respondents, followed by competition (20%) and finance costs (16%).

The ten-year averages for operating costs (10%), fuel costs (8%) and crew supply (5%) are all below the corresponding averages of 12%, 11%, and 11% for May 2008, doubtless due to the effects of the economic downturn and fluctuations in the price of oil. Ten years ago, regulation was cited by just 2% of respondents as a significant performance-affecting factor. Today it stands at 10% and averages 4% over the decade.

Over the last decade, an average of 48% of respondents have been of the view that finance costs were likely to rise over the coming year. When the survey was launched in May 2008, 66% of respondents were of that opinion. By February 2009, the numbers had dropped to 47% and, by 2015, to 32%. Today, the figure stands at 63%.

Ten-year averages for the freight markets reveal a sizeable increase in expectations of higher dry bulk and container ship rates. Net sentiment in dry bulk was -3 in May 2008, but the 10-year average is +24. The corresponding figures for container ships are +2 and +15. Ten-year net sentiment in the tanker sector, meanwhile, was +20 in 2008, and averaged +19 over the decade. In all three tonnage categories, current expectations of higher rates are significantly above those of ten years ago.

When the survey was launched, respondents rated at 5.9 out of 10.0 the likelihood of making a major investment or development over the next twelve months. The average for the ten-year period is 5.3. Expectations peaked at 6.0 out of 10.0 in August 2010 but reached a low of 4.8 in February 2016.

Richard Greiner says, “The survey reflects the sentiments of a volatile industry in a particularly volatile decade. Significant events have included the peak of a boom, a prolonged global financial recession, crises in the banking sector, the collapse of stock markets, the Greek debt crisis, Brexit, and an unprecedented level of government and industry bail-outs.

“Ten years is a long time in shipping, and the past decade has doubtless felt a lot longer still to those industry participants who have lived through it, even those inured to the peculiar cyclicality of the industry. Confidence may have fluctuated, but it has never collapsed, and portents for the coming decade can reasonably be expected to be better.”

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 614 offices of independent member firms in 112 countries, employing 30,168 people and generating revenues in 2017 of $2.9 billion. www.moorestephens.co.uk/shipping-transport


For more information:
Richard Greiner
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
richard.greiner@moorestephens.com

Liberia underlines commitment to seafarer wellbeing on IMO Day of the Seafarer

The Liberian Registry has underlined its commitment to protecting the welfare of seafarers on the occasion of the International Maritime Organization’s Day of the Seafarer, which this year takes ‘seafarer wellbeing’, and mental health in particular, as its theme.

Scott Bergeron, CEO of the Liberian International Ship & Corporate Registry (LISCR), the US-based manager of the Liberian Registry, says, “Our seafarers are the lifeblood of our industry. Without them, shipping is nothing, and yet their commitment and efficiency is such that the industry is sometimes in danger of taking them for granted. It is therefore right that IMO should dedicate a specific day each year to recognise this remarkably dedicated workforce, and to highlight the issues they face on a daily basis.

“The Liberian Registry is dedicated to protecting the welfare of seafarers and to ensuring that the maritime industry maintains its commitment to promoting greater understanding of mental health concerns and awareness of the issues facing all onboard personnel. There are over 270,000 active seafarers who are certified by Liberia, of which nearly 100,000 are currently employed on Liberian-flagged ships. In addition, Liberia has taken a leading role in ratifying, implementing and overseeing the application of the Maritime Labour Convention (MLC 2006).

“Everything we do, from our everyday operations to the ongoing development of technical innovation, is designed with the interests of our seafarers in mind. Moreover, our MLC 2006 training programme for Liberian inspectors includes a module on seafarer welfare, developed in co-operation with The Mission to Seafarers, an organisation with which the Liberian Registry enjoys an excellent and highly productive relationship.

“In addition, The Ethiopian Maritime Training Institute (EMTI S.C), part of YCF Group, the parent organisation of LISCR, has successfully trained thousands of cadets and officers, who are now employed on vessels around the world. LISCR also manages the Liberia Maritime Training Institute (LMTI), which opened earlier this year.

“Whatever advances are made in shipping over the coming years, the maritime workforce will remain the industry’s biggest and most valuable asset. Liberia is dedicated to protecting the interests of that workforce, on IMO’s Day of the Seafarer and on every other day.”

Gerard Kenny, Technical Manager of LISCR’s offices in London, recently completed the 106km NightRider charity bike ride around London as a member of the IMO team raising funds for The Mission to Seafarers. He says, “Needless to say, I’m feeling rather fragile and a little weary today, but that’s nothing compared to what seafarers go through every day over prolonged periods at sea.”


The Liberian Registry has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive and innovative service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment. www.liscr.com

ITIC helps ship manager successfully refute owner’s allegation of negligence

International Transport Intermediaries Club (ITIC) has successfully defended a ship manager against allegations of negligence made by a shipowner following the loss of a lifeboat overboard.

The lifeboat was subsequently found drifting off the port of Naze, Japan, after the master of the vessel had reported it missing. In view of the cost of deviating the ship to recover the lifeboat, compared to the cost of replacing it, it was decided, in consultation with hull underwriters and the vessel’s P&I club, to abandon it. The P&I club arranged for the lifeboat’s disposal through its correspondent in Japan.

The owner brought a claim against the ship manager for $90,000, which sum was moreover withheld against fees and disbursements owed to the manager, alleging that the loss of the lifeboat had been caused by the manager’s gross negligence and mismanagement.

However, under the SHIPMAN 2009 management contract governing the relationship between the parties, the owner had no right to set off a claim against what was owed to the manager. Neither could the owner provide any evidence to support its claim that the ship manager had been negligent, let alone grossly negligent.

A report into the incident concluded that it had not been possible to physically examine the release mechanism of the lifeboat before arrangements for its disposal were made by the P&I club correspondent in Japan. The lifeboat had successfully undergone its annual service and inspection six months previously, however, and had been wire-lashed on board the vessel for added security.

ITIC advised the owner that, if the sum owed to the manager was not paid, interest would be applied, and the ship would be arrested. The owner thereafter remitted the funds due, and nothing further was heard about the lost lifeboat.

ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com


For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com

Offshore Ship Designers adopts OSD-IMT as name for entire group

New name leverages quality and aligns company in a single brand name

Offshore Ship Designers (OSD) has changed its company name to OSD-IMT. The goal of the name change is to leverage the strength of both OSD and IMT. IMT is the signature brand-name for vessels designed by OSD’s UK branch, which was already named OSD-IMT. Using one name for all offices reflects the way the group already works - as one single organization.

“The name Offshore Ship Designers has served us well up to now, but we have further increased the types of markets we serve and the range of services we provide,” says Lodewijk van Os, Managing Director for OSD-IMT. “We design all sorts of tailored vessels, offer various marine consultancy services and provide innovative conversion engineering. Our aim is to exceed expectations in terms of quality, innovation and reliability. We believe our way of working helps us build successful relationships with our customers, partners and employees.”

Along with the name change, the company has adopted a new corporate identity, including a new logo and visual identity. The visual changes will be rolled out in phases and all future business activity will be undertaken with the new name.

Van Os says, “While our company name and logo are changing, all core elements of the organisation will remain the same. OSD-IMT will continue to provide its clients with the next level in ship design and related services.”

Until further notice, there will be no changes to the existing legal entities and commercial register numbers. VAT numbers and bank details will also remain the same.

About OSD-IMT
OSD-IMT specialises in newbuild design and basic engineering for a wide range of ship types including tugs, workboats and vessels for the offshore, renewable energy, passenger transport, aquaculture, fishing and general cargo markets. Strategically located in Europe and Asia, its experienced teams provide a full range of consultancy, naval architecture and marine engineering services, including concept FEED studies, vessel refit and conversion, and structural and stability investigations.

www.offshoreshipdesigners.com

For more information:
Merijn Brusselers
Offshore Ship Designers
+31 (0)255 54 50 70
mb@offshoreshipdesigners.com

Liberia backs Australia’s push for IMO reform

The Liberian Registry has confirmed its support for an initiative by Australia calling on the International Maritime Organization (IMO) to reconsider transparency and the role of industry bodies in the organisation.

Liberia is the largest flag state to support the push by Australia, which will lead to a submission to the IMO Council meeting in July calling into question the existing role of the IMO Council and the IMO Assembly, and seeking to facilitate greater transparency and the wider representation of maritime interests in the IMO.

The Australian submission suggests that discussions at IMO should be more open to the public and other stakeholders. It also refers to the decreasing accessibility of discussions and decisions within the IMO Council and Assembly for both member states and the public.

Scott Bergeron, CEO of the Liberian Registry, says, “As a founding IMO member and the world’s second-largest flag state, Liberia has always been a committed and public supporter of IMO, and will continue to be so. But it is only right that we should lend our support to Australia’s push for reform in the light of concern from observers both within and outside the organization that the IMO decision-making process may not be fit for purpose in the 21st century and may moreover be susceptible to commercial influence.”


The Liberian Registry has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive and innovative service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment. www.liscr.com

Liberian Registry and China Classification Society sign innovation and technology MoU

Liberian Registry and China Classification Society sign innovation and technology MoU

The Liberian Registry has agreed a framework co-operation Memorandum of Understanding (MoU) with the China Classification Society (CCS) as the latest step in its strategy to collaborate effectively with its long-term key industry stakeholders.

Under the terms of the MoU, the Liberian Registry’s technical competence will be employed to help shipyards and shipowners improve their innovative strategies. The CCS MoU has a particular focus on innovation and technology within the international regulatory framework and maritime sector projects. It is an extension to the governmental Maritime Transport Agreement between China and Liberia which entered into force in February 2016.

The MoU is the most recent agreement between the Liberian Registry and reputable, high-quality stakeholders in the Chinese shipbuilding industry. The Registry has also signed ten MoUs with leading shipyards, shipyard groups and ship design companies in China in order to create a platform for the exchange of market intelligence, innovation and technological development.

A streamlined Ship Newbuild Services facility is also available to Liberian-flag shipowners through dedicated joint industry ship design projects. The intention is to produce quality, innovative ships capable of high performance levels and outstanding Port State Control performance, in compliance with all rules and regulations.

Thomas Klenum, Technical Director of the Liberian International Ship & Corporate Registry (LISCR), the US-based manager of the Liberian Registry, says, “Through MOUs, the Liberian Administration will be involved in the process of ship design and construction from the beginning, which will improve efficiency in meeting IMO requirements at the most cost-efficient phase of shipbuilding projects.”

Meanwhile, LISCR CEO Scott Bergeron says, “Under the terms of the MoU, the Liberian Registry’s technical competence will be employed to help shipyards and shipowners improve their innovative strategies. In this way, the Liberian Registry will be able to expand its continually growing fleet numbers with ships of the highest quality and safety standards, able to operate competitively in today’s challenging shipping industry.”


The Liberian Registry has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive and innovative service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment. www.liscr.com

AKD appoints new partner to Transport & Energy team

Leading Benelux law firm AKD has appointed Vivian van der Kuil a partner in its Transport & Energy team with effect from 1 June 2018.

Vivian joined AKD in 2015. She is an international litigation specialist with wide experience as a lawyer of complex proceedings in the Dutch Civil and Criminal Court. She is also a former judge and public prosecutor. Before joining the legal profession, Vivian completed officer training at the Royal Dutch Institute for the Navy and subsequently worked as an officer in the Operations/Navigation Service with the Royal Dutch Navy.

Vivian specialises in emergency response in the shipping and energy sectors, including salvage, total loss, collisions, fire and explosion, limitation of liability, wreck removal, piracy, ship arrest and both civil and criminal pollution liability involving seagoing vessels, inland waterway vessels, and yachts. She acts for charterers, traders, shipowners, hull & machinery underwriters and P&I clubs on charter party, bill of lading, offshore and general maritime issues. Vivian deals with insurance coverage and other shipping and energy-related commercial and contractual disputes. She also advises on public international law including the law of the sea.

Vivian is a Legal 500 first-rate recommended lawyer and a member of the legal committee of IVR, the international association of national organisations representing, among others, the inland navigation, insurance and surveying sectors. She says, “Transport and energy are volatile and complex areas, and I have been able to use - and to add to – my experience of these sectors since joining AKD. I am delighted to have been made a partner and to continue my development as part of an outstanding team.”

Jos van der Meché, head of AKD’s Transport & Energy team, says, “Vivian will be a great asset to our partner team. She has a wealth of experience of different areas of the industry at the highest level, as well as an impressive pedigree as an advocate and judge. She has all the experience and expertise necessary to improve still further the ability to find innovative solutions to complex issues which is the hallmark of the AKD Transport & Energy team.”

AKD’s Transport & Energy team provides a full range of legal services. AKD is a full-service Benelux firm with over 250 lawyers, civil-law notaries and tax advisers.

AKD: Law Firm of the Year: Benelux | The Lawyer European Awards 2018

www.akd.nl

London P&I Club reports increased free reserves for 2017/2018

THE London P&I Club has issued an advance summary of its result for the 2017/2018 financial year, ahead of the publication of its annual report. The club recorded an overall surplus after tax of $6.6m, increasing the free reserve to $194.6m. The combined ratio was 118.7 percent. In the year to 20 February 2018, there was an investment return on the club’s portfolio of 5.5 percent, or $18.9m, net of associated management expenses.

The club continues to receive additional entries from new as well as existing members and, following the February 2018 renewal, there was a year-on-year increase of 5.8 percent in its mutual membership. In addition, there was further volume growth in the club’s bespoke covers for charterers and for the owners of smaller vessels.

Ian Gooch, CEO of the club’s management team, says, “The continued strengthening of the free reserve was pleasing and the growth in the membership was also encouraging. At the same time, though, the 2017/2018 result reflected a $14.4m rise in the cost of the club’s net incurred claims, the drivers of which included an increase in claims activity involving the International Group Pool as well as an increase in the cost of higher-severity Fixed and Floating Object claims within the club’s retained layer. The claims outturn coincided with a period of continued pressure on P&I premium levels and the combination of these factors contributed to an increase in the combined ratio.”

www.londonpandi.com

USCG report confirms Liberian Registry’s stellar PSC record

The Liberian Registry has seen a 62 percent reduction in vessel detentions in the United States over the past three years and, for the fifteenth year in a row, is not among those flags targeted by the US Coast Guard (USCG).

Alfonso Castillero, CCO of the Liberian Registry, says, “Despite efforts made by other flags to confuse the industry, the USCG 2017 Annual Performance Report for Port State Control (PSC) makes it clear that, far from being targeted by the US Coast Guard, Liberia continues to provide effective, quality compliance solutions for its fleet. Liberia is not on the list of USCG-targeted vessels.”

The Liberian Registry continues to improve its PSC performance year after year, and currently has the fourth most vessels of any flag state enrolled in the USCG’s Qualship 21 programme. In addition, it is White-Listed by the Paris MoU and the Tokyo MoU. Indeed, it had the lowest detention rate of all major flags (1.67%) in the 2017 Paris MoU. It has also recorded a 20% reduction in detentions over the last three years under the Tokyo MoU, thanks to a 2% detention ratio change during that period which is the is the biggest positive increase among all major flags in the Tokyo MOU.

In China, meanwhile, Liberia has achieved a 41% reduction in detentions thus far in 2018 compared to last year and is the only major flag able to show a decrease in detentions over the past three years in China. Finally, in Australia, there has been a 49% reduction in detentions of Liberian-flag ships over the last three years and a 6.4% detention ratio change over that period which is the biggest positive increase of all major flags in Australia.

Alfonso Castillero says, “With the use of a fully staffed Risk Assessment Department at its US head office, and an automated LRIT-based Compliance Assistance Program, the Liberian Registry works with its clients to ensure that their vessels are well-prepared for port calls in the world’s high-focus jurisdictions, and that any issues are properly reported and addressed.

“This is one reason why the registry has seen such an impressive increase in growth recently. Owners have benefited tangibly from Liberia’s SeaSafe System and Compliance Assistance Program, without additional cost, and this has helped us expand into new markets. For example, last year we were the fastest growing flag in South Korea, a new and expanding market for us. In China we have had opened three new offices simply to keep up with demand. And value-added services such as SeaSafe help us maintain our position as the largest open registry in Greece.

“The Liberian Registry continues to invest in improving and maintaining quality, working closely with owners and managers to keep their vessels operating safely and efficiently. Out Port State Control record shows how effectively this is working, both in the US and elsewhere around the world.”


The Liberian Registry has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive and innovative service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment www.liscr.com

Liberia honours Greek shipping partners as it celebrates 70th anniversary

The Liberian Registry has presented five of its Greek shipping partners with the Liberian Maritime Authority’s Commissioner’s Award for Excellence during celebrations in Athens to commemorate the 70th anniversary of Liberia’s maritime programme.

The awards presented in Athens on 30 May to George Procopiou, Vangelis Marinakis, Panagiotis Tsakos, Panos Laskaridis, and Dimitris Lemonidis recognised contributions not only to Liberia but also to shipping and the community at large. All the recipients have diversified activities in other sectors as well as shipping and are recognised for their contributions to culture and public interests. Moreover, most have been identified on the so-called Top 100 lists of most influential shipping personalities.

George Procopiou, founder of Dynacom Tankers Management, started his active co-operation with the Liberian Registry in 2001 shortly after LISCR took over as the administrator of the Liberian flag. Since then, Dynacom has become Liberia’s largest client in Greece in terms of numbers of ships and deadweight tonnes.

Vangelis Marinakis has developed Capital Ship Management into a diversified shipping enterprise. Most notably, Capital Shipmanagement, with a very large fleet of Liberian-flagged ships, has one of the best safety records in the Greek-owned fleet as determined by both flag state and port state inspections.

Captain Panagiotis Tsakos, founder of Tsakos Shipping & Trading, has built one of the largest shipping companies in Greece. The Tsakos Group is also one of Liberia’s largest clients. The Tsakos-owned tanker ISE PRINCESS became Liberia’s 3,000th active vessel in 2009, exactly 60 years after the registration of Liberia’s very first vessel in 1949.

Panos Laskaridis, current President of the European Community Shipowners Association, is the driving force that led Liberia to become involved in regulating the fisheries transhipment business. This in turn resulted in Liberia becoming an active member of six Regional Fishery Monitoring Organisations globally. Similarly, Liberia is now in the process of completing its fisheries accreditation by the European Union.

Dimitris Lemonidis established Element Shipmanagement, his second start-up after co-founding Ciel Shipmanagement together with Kostis Konstantakopoulos. Dimitris has been one of the strongest and most vocal independent advocates of the Liberian flag both in Greece and globally.

Michalis Pantazopoulos, Senior Vice-President and Managing Director of LISCR Hellas, says, “Liberia is proud to honour these trusted Greek shipping partners with this award as a mark of gratitude for their continued support.”


The Commissioner’s Award was established by Liberian Commissioner James F Kollie to recognise the outstanding achievements of shipping industry leaders with a notable connection to Liberia’s maritime programme. The first such award was presented to Angeliki Frangou, CEO of Navios Holdings Inc in March this year.

The Liberian Registry has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive and innovative service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment. www.liscr.com

Shipbroker liable for fixture error leading to damages in rising market

International Transport Intermediaries Club (ITIC) recently helped a shipbroker reduce its level of exposure to claims from a charterer for damages and loss of profits in a rising market, following a failure to pass on fixture options correctly.

The charter agreement between the parties contained an option for a second voyage, but the broker failed to pass on the charterer’s message declaring the second-leg option, which had to be nominated upon completion of loading on the first voyage. The owner refused to perform the second leg as the option had not been declared in time, and the market had risen in the meantime.

The charterer maintained that, if the owner did not perform, it would claim from the broker damages of $500,000 representing the additional cost of fixing a ship in the prevailing market.

Following negotiations with ITIC and the broker, the owner agreed to perform the second leg for an additional $275,000, which more accurately reflected what could have been achieved on the spot market. ITIC reimbursed the broker for the additional freight.


ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com


For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com