Friday, October 26, 2012

[Marine] More younger ships scrapped

More younger ships scrapped

Investors are suggested to pay attention to total volume of demolition exceeding that of S&P activity and lowering ages of scrapped ship this year.

Analyst Park Mu-Hyun of E*Trade Securities said a total of 984 second-hand vessels have been traded year-to-date, comparing with 1,028 vessels sold for scrap. Overall ships sent to scrapping facilities in the whole 2011 total 1,079 vessels.

Also, 2012's proportion of scrapped ships with ages of under 25 years now stands at 30%, increased from 7% in 2009 and 13% in 2011. Until the first half of this year, ships under ages of 25 accounted for 20%, but sharply increased to around 30% after August.

Park said that demolition of younger ships are expanding despite concerns over strikes in scrapping facilities and lower scrapping prices.

He forecasted "Demolition of younger vessels with lack of economic values will grow," and "Fuel-efficient vessels now control S&P market."

Published : October 26, 2012

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