As a result of an oversupply of vessels in the industry, the global shipping market is unlikely to see a recovery during the next two years, according to the chairman of China Ocean Shipping Group (COSCO), Ma Zehua.
Vessels have swamped the market since the financial crisis of 2008 and now the sector is experiencing overcapacity, Ma Zehua told reporters.
The chairman of COSCO said that the firm now plans to focus on cost control, as well as expanding to South America and the Middle East, as it looks to secure long-term customers.
Ma Zehua said: “I don’t think the market will recover within the next two years. There are a lot of new building orders, which means the chances of the supply-demand imbalance improving soon are small.”
He added: “Everyone will compete on costs, because improving income is very difficult, if you want to increase the freight rate it’s tough, it’s not possible, the only way is to control costs.”
Ma Zehua said the company would also announce partnerships with other large Chinese shipping firms in an effort to consolidate China’s shipping industry; an initiative that has been set out by the Chinese government, according to Reuters.
Source: http://www.porttechnology.org/news/cosco_chairman_shipping_stuck_in_slump#.VFuRPBaZn1V
Similar Posts:
-
COSCO International announces 2014 results
COSCO International Holdings Limited announced the audited consolidated results of the Company and its subsidiaries (collectively the “Group”) for the year ended 31st December 2014, the company said in its -
Bankruptcy Sea Carriers Because Of the Collapse In Freight Rates
For the second ocean carrier filed for bankruptcy after the collapse of freight rates, which led to the loss of many companies whose vessels are idle, instead of transporting iron -
Vale to Lease 10 China Merchant Bulkers
Brazil’s iron ore miner Vale SA said on Friday it secured a deal with China Merchants Group to lease for 25 years as many as 10 very large ore carriers,