Multipurpose vessel sector makes a cautious recovery
The Naval Architect: 2019
According to Drewry, the UK-based maritime research consultancy, the multipurpose vessel (MPV) and heavy lift sector will see an annual average growth of 1.2% to 2023. In the short term though, this looks even stronger, at 3.8% for 2019 and 1.4% in 2020.
“The recession in the wider shipping industry hit the MPP sector particularly hard and we are only now seeing green shoots of recovery – albeit slow,” says John Pittalis, marketing and communications manager at AAL Shipping.
Despite the fact freight rates still sit below break-even levels while consolidation and further cost-cutting continues to loom, the trade wars, tariff threats and slowdown of emerging markets witnessed last year have finally ceased. Additionally, relations between the US and China have somewhat stabilised (though sudden combustion is possible) and global unemployment levels remain low.
“2018 was another tough year for MPP operators, with several players ceasing operations following massive losses, as well as many defaulting on their financing contracts and becoming financiers’ distressed assets,” says Pittalis. Last May, Zeamarine was formed as a joint venture between Zeaborn and Intermarine while German-based Hansa Heavy Lift filed for insolvency in December. “Although the market remains tough, there are some more positive signs emerging.”
A growth in infrastructure and construction in expanding cities across the Middle East, Africa and South East Asia have enlightened the sector with a cautious optimism.
One of the segment’s greatest supports though, is renewable energy. The international surge for renewables – wind energy in particular – has driven the need to move massive, heavy and irregularly shaped equipment like wind blades and towers. Such project cargo is ideal for large MPVs, which can both lift and stow the equipment.
However, the MPP sector as a whole is not basking in this positive news.
Drewry has noted that MPVs with a heavy lift capacity of less than 100tonnes are in decline and expects this downward trend to continue for the “foreseeable future”. It estimates these smaller vessels could see a drop of nearly 3% each year through to 2023.
In contrast, vessels with a lift capacity of over 100tonnes are increasing at a rate of around 2% per year. Most newbuild deliveries and orders are of this category.
The tendency over recent years has been to build ships with 250tonnes cranes and space for heavy equipment, while scraping smaller vessels with less than 100tonnes of lift capacity.
This uptake has benefitted heavy lift fleets such as AAL’s second-generation 31,000dwt A-Class MPVs. With the ability to accommodate multiple cargo types on a single journey (breakbulk, project cargo and dry bulk commodities) and an intake of 40,000cbm, AAL’s A-Class vessels offer shippers significant economies of scale, says Pittalis.
In April of this year, one of the Singapore-based company’s A-Class vessels, the AAL Kobe, made its first call to the UK at Felixstowe – the country’s busiest cargo port. Built in 2012, the 193.9m long MPV features a combined 700tonne max lift, five cargo holds with an intake of 40,000m3, two tweendecks and a 2,700m2 weather deck. Two supplementary cranes, situated at the fore and aft, have a lift capacity of 50 and 100tonnes respectively.
The vessel is an example the market’s evolution towards ships that can transport oversized objects as well as various bulk and container products. Such an MPV also offers shippers the opportunity to call at smaller ports, which may lack landside cranes but are closer to the cargo’s ultimate destination.
“The Kobe serves our global tramp chartering services, where her flexibility and mega-size are put to good use by a broad mix of customers, representing multiple industry sectors like oil gas, mining, infrastructure, energy and leisure,” says Pittalis.