Asia’s maritime leaders called for the industry to adapt more quickly to changing market conditions in order to effectively capture opportunities and ensure its long-term future across the region .
Volatile commodity prices as well as fluctuating supply and demand were highlighted as key issues driving the challenges.
“Asia continues to be the driving force behind global growth but slower-than-expected economic development in some markets has had a significant impact. The recent slow-down in China’s real-estate industry, for example, has reduced demand for iron ore at a time when there’s more dry bulk ships in the global fleet,” Managing Director of Precious Shipping Ltd, Khalid Hashim, said while speaking at a Sea Asia 2015 industry insights briefing.
“Iron ore makes up a significant portion of the cargo transported by dry bulk shippers and this softening demand, coupled with increased capacity, has resulted in a significant shift in the supply and demand balance within the global dry bulk shipping sector,” he said.
Singapore Maritime Foundation Chairman (SMF) and Managing Director (Marine & Technology) at Keppel Offshore & Marine Ltd, Mr Michael Chia commented that fluctuating commodity prices is another new reality impacting the industry.
“Low bunker prices have a positive impact on the shipping industry but our marine and engineering sectors are likely to face some headwinds in securing new orders. Fortunately, the industry has a full backlog of orders that will carry them through this year and into 2016. In the meantime we need to focus on increasing productivity, reducing costs and driving efficiencies to manage this volatility,” Chia said.
Maritime and Port Authority of Singapore (MPA) Assistant Chief Executive (Development), Tan Beng Tee commented the government is working with the industry to ensure it is prepared to manage changing market conditions.
“In order for Maritime Singapore to be future-ready, MPA is introducing schemes to develop quality manpower which is critical to drive growth in this global business,” she said.
This year, MPA will inject another $65 million to the maritime cluster fund-manpower development programme to attract and groom talent for the maritime sector. Tan added that MPA is also investing in infrastructure development, with the completion of phases three and four of the Pasir Panjang terminal expected by the end of 2017. The expansion is aimed at increasing the terminal’s handling capacity by more than 40 per cent.
Sea Asia 2015 will be held in Singapore from 21-23 April 2015 and it is expected to attract around 14,000 participants from over 60 countries.