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JUST – C Limited
Capital Link, AthensShipping markets - Sector review, analysis & outlook
20 February 2020
Joakim Hannisdahl
Head of Research
Coronavirus: Confirmed cases & deaths (globally)
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Coronavirus (Covid-19)
Source: Cleaves Securities, Bloomberg
Significant impact on shipping – Most likely a temporary effect
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Confirmed deaths globally
Confirmed cases globally
Confirmed cases globally
Confirmed deaths globally
New method for diagnosing
Covid-19 cases in China
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Confirmed cases globally (1w
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Confirmed cases globally (1w MA): 2nd …
First sign of the virus
spread abatingcould be the falling 2nd
VLGC supply dynamics VLGC supply, demand & fleet utilization
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LPG Shipping (VLGCs)
Source: Cleaves Securities, Shipping Intelligence Network
Supply growth outpacing demand growth in 2021E, with balanced growth thereafter
VLGC spot rates (monthly) VLGC share index vs 3y old VLGC (R²=0.86)
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LPG Shipping (VLGCs)
Source: Cleaves Securities, Bloomberg, Shipping Intelligence Network
The cyclical peak could already be behind us, with the next trough in 2021/22E
LNG Carrier supply dynamics New liquefaction projects
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LNG Shipping
Source: Cleaves Securities, Shipping Intelligence Network
Fleet growth to significantly outpace demand growth in 2021-22E, before the dynamics could be reversed thereafter
LNG Carrier supply/demand dynamics TFDE spot rates (quarterly)
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LNG Shipping
Source: Cleaves Securities, Shipping Intelligence Network
Headwinds ahead, but the long-term outlook is very positive
Dry bulk supply dynamics Dry bulk supply, demand & fleet utilization
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Dry Bulk Shipping
Source: Cleaves Securities, Shipping Intelligence Network
Low demand growth offset by even lower supply growth
Longest dry bulk shipping cycles since 1741
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Dry Bulk Shipping
Source: Cleaves Securities
Ongoing cyclical expansion could be one of the longest on record
Oil tanker supply dynamics Oil tanker supply, demand & fleet utilization
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Oil Tankers
Source: Cleaves Securities, Shipping Intelligence Network
Lowest orderbook since 1997 against strong demand growth in 2019-20E
VLCC spot rates (quarterly) Oil Tanker share index vs 5y old VLCC (R²=0.90)
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Oil Tankers
Source: Cleaves Securities, Shipping Intelligence Network
Earnings expected to stay strong, with further upside in asset and share prices
The current cyclicality of the shipping segments (2020E)
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Summing up Shipping
Source: Cleaves Securities
Headwinds for gas transportation while the outlook for dry bulk and oil tankers looks bright
Joakim Hannisdahl, Head of Research
Currently ranked #1 Shipping Equity Research globally by Bloomberg
www.cleaves.no