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Title: Future of the MPP carrier market
Authors: Leong, Ernest Jiahe
Keywords: DRNTU::Engineering
Issue Date: 2016
Abstract: Multipurpose (MPP) shipping is a niche sector, transporting project, floating, break-bulk and unitised cargoes. While MPP shipping remains differentiated from other shipping sectors, it is now easily affected by many unique influences, which were unobserved in the past. This report seeks a balanced outlook of the Asian MPP shipping market within the next 7 years, through reviewing trends in market fundamentals, reappraising analysis by economists, considering different perspectives and concerns of multiple MPP carriers and interpreting firsthand observations of these industry-insiders. While existing research have identified the general phenomenon observed in MPP shipping, the underlying conditions and influences that bring about these developments should be examined to further understand their impact on the market. Observations and perspectives of MPP carriers are also critical to conclude the importance of each issue and identify the genuine concerns within the market. This report covers a comprehensive list of issues affecting MPP shipping, including current cargo trends, the main demand drivers, competition in the MPP shipping market, and changes in tonnage supply. The main demand drivers of MPP shipping are infrastructure development and developments in the energy sector. New MPP carriers, collaborations between existing MPP carriers, encroachment of the wider MPP cargoes from other shipping sectors, and differentiation between MPP carriers are the most dominant sources of rivalry in MPP shipping. Overall, the MPP shipping market will remain tough within the next two years. Declined economic activities in major customer industries of MPP shipping have led to a reduction of demand for MPP shipping. Furthermore, there is heightened competition within MPP shipping. However, MPP shipping remains niche to specialised project cargoes. The oversupply of MPP tonnage is also expected to be corrected, tightening the balance between MPP tonnage supply and demand for MPP shipping. Customer industries of MPP shipping are predicted to recover, therefore suggesting an encouraging future for MPP shipping. MPP carriers should put much effort to ensure their survival through the extended trough of the market, focusing on improvements in daily operations. By being more cautious and efficient in their operations, MPP carriers will be able to sustain and survive through the current tough MPP shipping market. Differentiation and improving on their competitive advantage will also ensure MPP carriers’ competitiveness. In view of the dynamic conditions in MPP shipping, MPP carriers should be flexible and seek opportunities to be one step ahead of competitors.
Rights: Nanyang Technological University
Fulltext Permission: restricted
Fulltext Availability: With Fulltext
Appears in Collections:CEE Student Reports (FYP/IA/PA/PI)

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