From the Mail Online, “Revealed: the Ghost Fleet of the Recession”. This is the most stunning evidence yet that things will not be back to normal any time soon. 12% of the world’s cargo fleet sits idle?! One-in-eight ships tied at anchor out in the middle of the ocean!? And the shipyards continue to produce more…
“A couple of years ago these ships would be steaming back and forth. Now 12 per cent are doing nothing.
You may wish to know this because, if ever you had an irrational desire to charter one, now would be the time. This time last year, an Aframax tanker capable of carrying 80,000 tons of cargo would cost £31,000 a day ($50,000). Now it is about £3,400 ($5,500).”
“Aframaxes are oil bearers. But the slump is industry-wide. The cost of sending a 40ft steel container of merchandise from China to the UK has fallen from £850 plus fuel charges last year to £180 this year. The cost of chartering an entire bulk freighter suitable for carrying raw materials has plunged even further, from close to £185,000 ($300,000) last summer to an incredible £6,100 ($10,000) earlier this year.”
I have been very skeptical of those saying the worst is past. I certainly don’t see it my USA businesses, both in manufacturing. I see a slight uptick coming as some businesses replace inventories, but nothing like a return to the boom years in the near future.
However, for those wishing to do business in China, this is a time of opportunity. Freight is at all-time lows. Chinese factories have massive over-capacity. If you can secure financing and know you market well enough to move the goods, now is a great time to buy. Through PassageMaker’s Endorsed Service Provider network, we can introduce you to resources that can help make your project a success. By conducting a Sourcing Feasibility Study, we can shop a number of vendors and establish a true ‘China price’.
Even in a terrible recession, people make money if they play their cards right.