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Shipping industry in trouble-IV: Some companies will suffer more
May 05: All these dramatic changes are taking place at a time when the shipping industry is enduring a serious downturn ever since the financial crisis in 2008.
8Into 2016, the crisis has not disappeared, as was evident by the collapse of Hanjin, one of the world's major container lines.
8Freight rates barely cover operating costs, leave alone the repayment of loans for the vessels themselves.
82017 looks like another difficult year
8The future continues to remain uncertain as maritime trade grew because of incredible demand emanating out of China but the problem is that emerging countries like China are now increasingly come to resemble OECD economies, a larger proportion of GDP growth is taken up by services and domestic consumtpuon.
8And as the outlook looks uncertain, the industry is being saddled with massive increases in operating costs, primarily due to important new environmental regulations.
8It is now clear that to get the shipping market to balance, a large number of vessels will be needed to be recycled before the end of their normal 25 year life and this may not be in the best interest of individual ship owners.
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