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Wednesday, December 13, 2017

Continued improvements in the chemical tanker market - Drewry

According to the Drewry Quarterly Analysis of the Chemical Market of the 1st quarter of 2005 (1Q05), the market continued through the 4Q04 with high product demand, which maintained freight rates at high levels, both for intra-regional and deep sea trades. 4Q04 saw owners taking more Contracts of Affreightments (COAs) than during the previous quarter. 

Drewry states that scheduled chemical tanker deliveries and forecasted deletions all point towards an increase in the fleet supply. However, the forecasted strengths in the global economy and increasing Asian demand are expected to generate a further increase in the seaborne trade of chemicals.

 INTERTANKO is also recording the development of chemical freight rates, which can be seen in tables and graphs at the following link on the INTERTANKO website:

http://www.intertanko.com/research/issue.asp?topic_id=125  

Given the geographic imbalances between future planned chemical production capacity (particularly in the Middle East) and future consumption regions (primarily China), Drewry expects that seaborne trade in bulk chemicals will continue to display a healthy growth pattern. At the end of 2004, chemical tanker demand was calculated at a little above 20 million dwt. In 2005 demand is expected to grow strongly at just under 6.5%. Drewry notes that demand growth is skewed towards the larger vessel sizes especially in the 30,000 dwt and above segment.

 Drewry has revised its assessment of the chemical and vegoil tanker fleet through a survey of the fleet and individual ships’ trading pattern and vessel characteristics. At the end of 2004, the chemical tanker fleet stood at 1,901 tankers totalling 25.6 million dwt. Ships of 10,000 dwt and below account for over half of the fleet. As a result of the detailed fleet study, the reassessment of the orderbook has resulted in a higher share of tankers with chemical/vegoil capacity on order than that reported in the previous quarterly report. The revised orderbook lists 361 tankers of 6.5 million dwt, equivalent to 25.5% of the existing fleet. 263 of these ships on order are above 10,000 dwt. The orderbook is dominated by the 10,000-20,000 dwt segment with 178 ships on order.

According to the Drewry Quarterly Analysis of the Chemical Market of the 1st quarter of 2005 (1Q05), the market continued through the 4Q04 with high product demand, which maintained freight rates at high levels, both for intra-regional and deep sea trades. 4Q04 saw owners taking more Contracts of Affreightments (COAs) than during the previous quarter.

Drewry states that scheduled chemical tanker deliveries and forecasted deletions all point towards an increase in the fleet supply. However, the forecasted strengths in the global economy and increasing Asian demand are expected to generate a further increase in the seaborne trade of chemicals.

INTERTANKO is also recording the development of chemical freight rates, which can be seen in tables and graphs at the following link on the INTERTANKO website: http://www.intertanko.com/research/issue.asp?topic_id=125

Given the geographic imbalances between future planned chemical production capacity (particularly in the Middle East) and future consumption regions (primarily China), Drewry expects that seaborne trade in bulk chemicals will continue to display a healthy growth pattern. At the end of 2004, chemical tanker demand was calculated at a little above 20 million dwt. In 2005 demand is expected to grow strongly at just under 6.5%. Drewry notes that demand growth is skewed towards the larger vessel sizes especially in the 30,000 dwt and above segment.

Drewry has revised its assessment of the chemical and vegoil tanker fleet through a survey of the fleet and individual ships' trading pattern and vessel characteristics. At the end of 2004, the chemical tanker fleet stood at 1,901 tankers totalling 25.6 million dwt. Ships of 10,000 dwt and below account for over half of the fleet. As a result of the detailed fleet study, the reassessment of the orderbook has resulted in a higher share of tankers with chemical/vegoil capacity on order than that reported in the previous quarterly report. The revised orderbook lists 361 tankers of 6.5 million dwt, equivalent to 25.5% of the existing fleet. 263 of these ships on order are above 10,000 dwt. The orderbook is dominated by the 10,000-20,000 dwt segment with 178 ships on order.

140 chemical tankers are expected to be delivered in 2005 and 101 ships in 2006, which implies that the fleet is set to absorb a significant amount of tonnage in the near to medium term. Based on the age profile of the fleet, Drewry forecasts recycling of 27 chemical tankers in 2005 and 29 in 2006, most of which are 10,000 dwt and below. However, demand growth is expected to offset the sharp rise in tanker supply.

Contact: Erik Ranheim