As per the Outlook Report for 2019 from the Norwegian Shipowners’ Association, the Norwegian shipping companies showed a total turnover of NOK 229 billion in 2018, which is 11 per cent higher than the previous year. With a hike in freight rates in the second half of the year, the international deep sea shipping companies reported strong growth in 2018. While 60 per cent of shipowners expects revenue to rise in 2019, the rest 40 per cent is divided equally, with 20 per cent expecting revenues to reduce and the other 20 percent expecting revenues to remain unchanged.
Deep sea shipping companies remain the largest sector in the foreign-bound fleet in Norway that has witnessed increased revenue in 2018 and expecting it to touch NOK 120 billion in 2019. The survey showed that revenue generated from foreign markets by the Norwegian shipping companies comprised of 61 per cent of total turnover or NOK 139 billion in 2018.
In the short sea shipping segment, Germany remains the largest market, with the UK coming next. For deep sea shipping, the USA and China remain the leading markets. In the case of offshore and rig companies, Norway and the UK remain important markets. The offshore shipping market is expected to be challenging with a large number of ships remaining in lay-ups, short-term contracts, and extended period of low rates.
The increased profitability of the Norwegian shipping industry is the result of many years of major cost reductions, improvement in efficiency, and consolidation of the shipping industry. The major cost reductions and a stable oil price, which remains higher than the lowest levels led to good profits for oil companies.
The lay-up of ships reached its highest level during the winter of 2017. The numbers of offshore vessels and rigs in lay-up in February 2019 remains 112 and 20, which are lower than the previous year figures of 137 and 25. The Association members report predicts a fall in figures to 78 ships and 15 rigs by this year-end. This has resulted due to a rise in activity on the Norwegian shelf and ship sales.
As per the report, the survey found that half of the shipping companies plan to opt for the new building of their fleet in the next five years. As per shipowners estimation, a total of 137 ships and five rigs will get contracts in this period. The majority of contracts will take place in the deep sea, transport segments, and short sea shipping. Over 40 per cent of the shipping companies, mainly the short sea ship owners find Norwegian shipyards fit enough to build new vessels. For the Norwegian shipowners, supplier companies and offshore enterprises, the time is perfect for taking a more significant role in the renewable market.
Three shipping companies are already actively involved in the offshore wind market today. In the next five years, 27 per cent of the shipping companies and 55 per cent of the offshore service companies plan to consider the offshore wind market actively. The aquaculture industry is of interest to 18 per cent of the shipping companies in the next five years, while sub-sea mining is of interest to 14 per cent.
With almost two decades of serving the shipping market, NORWEGIAN SHIP SALES AS, the cruise ship brokers is a well-known name in the sale and purchase of Ferries, Roro/Ropax Vessels as well as Cruise Vessels.
