Growth opportunities for the shipping services industry
The shipping services industry is largely divided into two major segments – wet bulk and dry bulk. This classification is based on the kind of products ships carry. While those carrying wet stuff like crude oil, petrol, or diesel fall into the category of wet bulk, the ones that carry ‘dry’ merchandise like food grains and hard commodities like steel, iron ore, and aluminium, fall into the dry bulk category.
As far as the wet bulk side of the shipping services industry is concerned, growth is largely depended on the amount of crude oil produced in the world. This crude oil needs to be either transported to refineries to be converted into fuel like petrol and diesel, or it is stored by producing companies in ships to create an artificial price rise in the times when demand is high. These ships that are used for storing crude oil are called ‘floating storages’.
Coming to the dry bulk side of the shipping services industry, growth here is largely dependent on how much commodities are being consumed in China, which is currently the world’s largest consumer of commodities like food grains, steel, iron ore, and other metals. The dry bulk market for shipping services companies had hit a bad patch in the 2008 and 2009 but things seem to be getting better as of now.
Overall, both the segments – wet and dry – of the shipping services industry are likely to grow strongly in the years to come. This will largely be led by strong demand for fuel, food, and other hard commodities, especially from the developing markets of India and China.