THE shipping industry is predicted to make a comeback in 2020, following a decade of “ups and downs”, IHS Markit predicts.

IHS principal analyst Dalibor Gogic talked of potential for fleet removals and the impact of IMO sulphur rules and the adoption of scrubbers.

“Considering the fact that fleet supply will likely tighten due to scrubber retrofitting and potential demolitions, given that demand remains healthy, we may see stronger freight rates this year,” Mr Gogic said.

“In addition, the fact that the orderbook for major commodity fleets has been relatively quiet in the last two to three years, we expect to see some intensification of newbuilding orders throughout the next couple of years.”

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Mr Gogic said demolitions had been low during the last couple of years, after almost 1m TEU of capacity was removed in 2016 and 2017 from the container shipping market.

About 3% of fleet older than 20-years would be prime candidates for demolitions in 2020.

As of 1 January 2020, about 2000 vessels, or less than 10% of the global fleet capacity, are equipped with scrubbers.

“Scrubber adoption started slow last year and scrubber retrofitting also has been delayed due to technical difficulties and lack of key parts available in yards,” Mr Gogic said.

“However, scrubber adoption is expected to continue and a second wave of installations is expected this year.”

IHS Markit expects more than 3,500 units to be equipped with scrubbers by January 2021, including the number of new orders expected to be delivered and the number of vessels expected to be retrofitted with scrubber technology.

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