New orders forecast to ease off

Nobutaka Nanbu, Executive Managing Director of the Shipbuilder’s Association of Japan (SAJ), reported at the regular SAJ press conference held earlier this month that newbuilding orders placed with Japanese yards for the first half of 2004 amounted to 3.83 million CGT, which is virtually unchanged from the 3.80 million CGT for the same period in 2003.

Most shipyards have sufficient work and are being selective about accepting new orders. The SAJ forecasts that the yards will maintain this stance as new order levels finally return to normal levels after last year?s surge of orders.

Since last year there has been an upward tendency in both bulk carrier and tanker prices resulting from an active shipping market and boom in freight rates. Recently, however, bulk carrier rates have started to fall and this is expected to lead to a downswing in bulk carrier prices except in the Capesize sector. The hope is that ship prices will stabilize and that a modest level of profit can be ensured.