MPP sentiment index hits lowest point since inaugural edition
The Market Sentiment Index has hit its lowest point since the inaugural edition in March 2021. The indicator index of activity in the MPP industry has continued its slide since hitting a peak of 58.8 in April 2022. The only ‘anomaly’ in the trend was a short-lived bounce in April 2023.
Issued by the Hamburg-based specialised shipbroking house, One World Shipbrokers, the MSI now stands at 51.5. It is the lowest point since the inaugural edition in March 2021.
Whilst carriers reported waning confidence to all the questions that make up the index this time it was the short-term outlook that fell the least. Typically, the northern summer season is a challenging period in the MPP sector, and this year was one of the most challenging in recent times for carriers in all geographical sectors, according to the shipbroker.
Read also: Subdued summer in the MPP sector
“A lift in short-term confidence as we enter one of the highest activity periods of the year is therefore in keeping with annual cycles,” One World Shipbrokers’ analysts said.
Longer term confidence in demand growth remains intact led by an expanding project sector which is backed by a supply side that is unlikely to add any meaningful dwt tons in the coming few years.
One World Shipbrokers added that the index is forecast to sit at 54 twelve months down the road. The average index value over its eleven editions is sitting at 54.4.
Tendering activity among the project forwarder community is reported to be very high with oil & gas-related projects leading the charge as high oil prices continue to underpin new project investment, One World Shipbrokers said.
Cargos coming from the renewables sector though have largely disappointed this year. Delays and postponements due to financing and economic factors are working their way through a complex political and legislative process and whilst it is expected solutions will be found it is without doubt dampening the MPP outlook.