According to Shipping Exchange, although global shipping is entering a period of fragile growth, rising costs, and increasing uncertainty, for investors with a long-term vision, shipping can still provide solid investment opportunities. At the same time, shipping executives advise investors to secure ship charters in advance.
Despite geopolitical turmoil and uncertainty clouding the global economy, Constantin Baack, CEO of independent container ship owner MPC Container Ships ASA (hereinafter referred to as “MPCC”), still believes there are good investment opportunities in the container shipping industry.
Constantin Baack said, “This is clearly a market environment characterized by uncertainty and fairly high asset values. Especially in the container shipping market, investment risk can be reduced by locking in charters.”
He emphasized, “Therefore, even in a fairly high asset price environment, investment risk can be reduced by locking in charters.”
He pointed out that the “super boom” caused by the pandemic was very beneficial for liner companies, allowing them to accumulate substantial cash reserves, with low debt and strong balance sheets.
He stated, “The good market has also led to very strong balance sheets, especially in the container shipping market. Our clients, the liner companies, have never had balance sheets as strong as they are now.”
Therefore, he advises investors to establish partnerships with liner companies and others to secure their investments and make them attractive to both parties.
Partnerships are also a way for liner companies to renew their fleets. The global fleet of feeder container ships is aging, and at the same time, increasingly stringent international climate regulations mean many ships will need to be replaced in the coming years.
Uncertainty also provides opportunities
Alex Ng, Vice President of Group Development and Strategy at Stolt-Nielsen, said that the current uncertainty in the global economy may also provide opportunities.
Alex Ng said, “We believe market uncertainty is not necessarily just a headwind; it also provides opportunities.”
He mentioned that since Trump’s so-called “Liberation Day,” the Stolt-Nielsen stock price has risen from over 200 to the current approximately 350 Norwegian Kroner per share. Alex Ng added, “Stolt-Nielsen is not a speculator; we are a shipping service provider.”
He emphasized that market uncertainty requires a cool head.
Alex Ng concluded, “It truly requires discipline and a strategic vision, whether based on the industry or an understanding of the asset cycle.”
