The shipping industry is facing bottlenecks and increasing prices at ship repair yards globally once activities begin to return toward normalcy following the conronavirus health crisis, says Trusteddocks, a shipyards matchmaking platform for shipping companies and dock operators.
“Our Ship Repair Index (SRI) predicts a very competitive market once activities fully resume,” says Carsten Bullemer, Trusteddocks founder and CEO. “A backlog demand has resulted from the dramatic fall in shipyard activities over the first half of the year, and this will cause capacity shortages in the coming months.”
For the past several years, Trusteddocks ’ Ship Repair Index (SRI) has continuously monitored all movements in and out of the largest shipyards worldwide and published them on its website on a weekly basis, organized both globally and by region. These selected “blue chips”—forming what Bullemer calls “the Dow Jones of the shipyard industry”—are scattered around the world, giving a very precise live picture of all ongoing activities involving ship repairs, refits and class renewals.
Both shipping companies and shipyards have been heavily impacted by the COVID-19 pandemic as world trade imploded and universally imposed social distancing restrictions additionally made their operations, even pared down to the minimum as they were, very difficult to maintain. But now, as the strict lockdowns are being lifted and economic activities can resume, the Trusteddocks SRI begins to reflect a recovery.
In the wake of this unprecedented crisis, following the eventual recovery of the world economy and pick-up of international trade, Bullemer expects difficulties especially in the area of class renewals and scrubber refits. “A lot of ships will now need to be docked, and you don’t need a crystal ball to foresee that, bottom line, shipyard prices can only go up,” he said.