¡¡¡¡Following five years of continued prosperity, 2008 will be full of changes for ship trading, which, though likely to experience a certain degree of decline, will yet retain the characteristics of a seller's market.

¡¡¡¡The recent period of prosperity for the ship market started five years ago, and thanks to the rareness of its length and the historical number of deals reached throughout its long duration, warnings of "wolves coming" have often been heard, and the sense of risk has become obviously more aggravated with the arrival of 2008.

¡¡¡¡2007, the peak year
¡¡¡¡According to statistics from Clarkson, new ship deals totalled 25 million dead weight tons in 2007, which was also the first time that global ship trading ever broke the 200-million-DWT mark.

¡¡¡¡Market drop predicted for 2008
¡¡¡¡After the peak year of 2007, opinions differ on the market's likely course in 2008.
¡¡¡¡Generally speaking, however, it seems likely to enter a period of adjustment and changes, and to witness a certain slide-down therein.
¡¡¡¡The interaction of various factors renders the current situation quite complicated and full of possibilities. Nevertheless, after five years of continual prosperity and, especially the peak year of 2007, it is highly expected that ship trading, though still brisk to the advantage of sellers, will unavoidably dip and drop in a number of aspects in 2008.

¡¡¡¡New Deals To Decline. New ship deals will possibly drop to below 200 million DWT in 2008 as against the 250 million DWT of 2007, and yet be still kept at around the average level of the last five years.

¡¡¡¡Hand-held Orders to Grow, Slowly. Global ship manufacturing will reach around 100 million DWT this year, less than the new deals concluded. Therefore, hand-held orders, though still set to increase, will grow at a much slower pace.

¡¡¡¡Ship Prices to Go Down. In 2007, especially the fourth quarter of that year, soaring bulk ship prices caused an unusual rocketing of prices for all ships, with Clarkson's price index peaking at 184 points. When such factors as de-valuation of the USD, steel price rises, higher construction costs due to adoption of new safety standards and maintaining of the seller's market characteristics are taken into account, the total contract prices of new ships seem likely to be kept at around the level reached in late 2007.
¡¡¡¡Through no serious changes are yet foreseen in this respect, it is possible that prices may go up or level up at first before coming down, and may even keep on climbing for certain specific types.

¡¡¡¡Bulk Ship Trading: Fast growth of hand-held orders, easing of port congestion and refitting from oil tankers will affect bulk ship trading in 2008, leading to unavoidable limitations to new deals. Nontheless, the market is to remain active generally.

¡¡¡¡Oil Tanker Trading: The serious accidents of leakage and strong rebounding of the market at the end of 2007 will both quicken the drop-out of single-hulled tankers and bring about an early construction recovery.

¡¡¡¡Container Ship Trading: Slower trade growth and tightened loan control by certain financial institutes in Europe will produce a negative influence on container ship construction in 2008. Orders will drop for 10,000-TEU ships and ships of greater capacity, and may increase for the Super- Panamax and Panamax.
¡¡¡¡Moreover, orders are likely to go on rising for ocean engineering vessels and Ro/Ro ships in 2008, though no such possibilities will appear for LNG and LPG tankers.