The Market Sentiment Index (MSI) for the MPP sector indicated the index improving to a level of 52.4 from the October 2023 low of 51.5. The index which has measured the market sentiment across the multi-purpose vessel owners/ operators who own a minimum of 5 Heavylift vessels, where at least a significant portion of their fleet have a lift capacity of over 100 MT, follows a rating system where a quote of 50+ points out to an optimistic scenario, akin to other indices in Logistics such as the Logistics Manager Index (LMI). This edition of the poll market forecast saw 26 respondents spread across geographies. While its previous quote indicated the lowest of 12 levels till date, the current quote was primarily driven on account of the “New Year, new hopes” story across markets.
A share of the fillip can be attributed towards the supply chain disruptions fueled by the re-routings away from the key artery gateways of Suez and Panama canals. However, the general consensus and drive by market demand is clearly missing in the commentary as the sentiment has been punctuated by the uncertainties in the market. Would more market participation and diversification unravel the market forces and key metrics? That remains to be seen, but the next quarter forecasts point out to a higher level of 54.1- 54.5 with the one year forecast pegged at 53.3 (the forecast estimates are reported based on the data from Q3, 2023). However, while demand has been subdued (note that there is no fall in demand seen, but neither a pick-up), the question of supply owing to lesser newbuilding activities and larger transit schedules owing to the canal blockages is expected to be answered by the market rates as it heads to Q2, 2024.
While Toepfer and Drewry indices for the MPV market seem to have taken a pause, ditto is the scenario with the shortsea market. While the TSI 52 accounting for the 4,800- 5,600 dwt category topping USD 6,000 while the TSI 35 representing the 3,200- 3,800 dwt category arrested its upward movement to end at USD 4,628. The renewable energy market dynamics could spell the heading for the rates in the coming months.
Author of the article: Gautham Krishnan
Gautham Krishnan is a logistics professional with Fluor Corporation, who has expertise in the Supply Chain area focusing in the Project Logistics domain, analytics and the LogTech space. He has worked in the areas of Project Management, Business Development and Government Consulting. For his body of work in the mentioned areas, he was bestowed the AntwerpXL 40-under-40 award in the year 2023, and touted to be one of the upcoming, future leaders in the project logistics & supply chain function.