for shipping rates
MISC Bhd’s chemical and container
shipping rates are also facing a gloomy outlook as rates weaken due
to slower demand and greater supply.
According to a local bank-backed
research house, this would impact MISC, which has 13 chemical
An analyst with the research house
said the slowdown in global crude oil demand would reduce refinery
runs and petrochemical output, directly affecting cargo availability
for the chemical tanker trades.
Meanwhile, the weaker consumer
demand for vegetable oils and excess vessel supply from high
newbuilding deliveries will also have a negative impact on rates,
the analyst said.
“As a result, we expect MISC’s
chemical tanker earnings to remain weak this year and next year.
“However, the division should not
go into losses because two-thirds of the capacity is tied-up
contract of affreightment (COA) that is naturally on a long-term
basis and falling bunker prices will reduce voyage costs,” said the
Its container shipping division is
also facing a bleak outlook as freight rates continue to fall,
especially in the Asia- Europe trade route, due to lower demand as a
result of the global economic crisis.
“As a member of the Grand Alliance,
MISC deploys most of its capacity on routes between Asia and Europe,
which have seen per box year-on-year rates fall by 75% to 80%,” the
research house pointed out.