Slow steaming – a viable long-term option?

Background for slow steaming A combination of factors have led to the past two years becoming hugely challenging for certain sectors of the global merchant shipping industry. Th ese factors include: Th e downturn in the global economy, resulting in reduced transportation capacity demand Th e substantial global order book for new tonnage, a legacy from the boom years, resulting in record-high deliveries of new ships Th e global fi nancing crisis Th e sudden fall in ship values High fuel costs Increasing operating costs (manning, lube oil, maintenance) Falling freight rates, which in turn also impacts charter rates. All of these things have put the entire value chain – starting from cargo owners to the carriers, ship managers, ship owners, fi nancing institutes and equipment suppliers – under big pressure. Th e industry has had to quickly adjust, which has resulted in a sharp slow-down in new ship orders, cancellations of already confi rmed orders, the delaying of new ship deliveries, layingup and idling of vessels, and all kinds of cost reduction measures.