Analysts have been raising a red flag to warn about “looming” overcapacity in the global container market. However, the situation seems to be quite the opposite in the European short-sea sector.
While a relatively large number of newbuilds are expected to enter the global scene in the near future, industry players claim there is a lack of investment in Europe’s short-sea fleet. According to a report by Germany’s transport newspaper DVZ, there is a need to provide more financial as well as shipyard capacities.
German Shipbrokers Association Rhine-Ruhr (ZVDS) requested the federal government to formulate a strategy that uplifts the short-sea market. DVZ cited ZVDS Chairman Wolfgang Nowak as saying, "The adoption of a short-sea strategy that includes increased momentum for fleet modernization and infrastructure expansion would be an important signal."
In addition, Nowak warned that the sector could face bottlenecks in the future despite the decrease in demand. “There are hardly any newbuilds,” he said, adding that there aren’t enough vessels to serve this sector. Compared to the global vessel orderbook, only a small percentage is dedicated to the short sea.
A specialised study by market research firm Brokers Market & Trend Information (BMTI) expects business on the short-sea to grow in the near term, especially if the ongoing geopolitical scene prompts moving industrial production back to Europe, reports DVZ. However, BMTI believes two obstacles need to be overcome: the lack of efficient shipyards and the uncertainty about suitable propulsion solutions that prepare for emission-free shipping.
