Jingu Finance News | Shipping stocks generally rose, but the overall increase was limited. Pacific Basin (02343) rose by 3.76%, Sinotrans Limited (00598) rose by 2.13%, Cosco Ship Engy (01138) rose by 1.67%, Cosco Shipping Holdings (01919) rose by 1.62%.
Huayuan Securities stated that the consensus on the cyclical prosperity of oil transportation ships is high, the recovery of bulk shipping is still under observation, and the container shipping sector continues to bottom out. Both the shipping and oil transportation sectors are supported by the logic of tight supply in the medium to long term. The core symbols of both sectors have significantly higher valuation levels than the corresponding index average, indicating that expectations are still present, but demand recovery is slow. Factors contributing to demand recovery include aging fleets, stimulus from environmental protection regulations for demand renewal, repeated delays in OPEC+ production resumptions, and uncertainties related to Trump 2.0's attitude towards oil production and towards Russia and Iran. The weak balance of supply and demand in bulk shipping, environmental regulations eliminating excess shipping capacity, and the market recovery still under observation; container shipping avoids the historical peak of deliveries, making it easy for shipping rates to rise and difficult to fall, continuing a bottoming cycle. Valuations in both sectors are relatively low, even at the lower end of the range, with no sufficient consensus on the cyclical trends.
Industrial Research indicates that the performance of the shipping industry is more influenced by "inefficient" factors and supply-side determinants. Container shipping: overall slightly in excess of supply, the continuity of "inefficient" factors such as the "Hong Kong crisis" will be crucial to the container shipping market. The institution predicts a slight drop in freight rates in 2025, and if the crisis is resolved in 2026, leading to a 4% decrease in demand, causing certain pressure on freight rates. Oil shipping: high prosperity may continue, industry demand side will benefit from short-term difficult-to-improve "inefficient" factors, namely the diversion of Russian energy resources and the boost from long-distance exports of North American and South American crude oil. It is expected that OPEC+ production cuts will end by 2025, and U.S. shale oil production may increase, but supply remains historically low, driving the industry to maintain high prosperity. However, the trend in increasing orders since March 2024 must be monitored. Bulk cargo: supply and demand are closely balanced, versatile ships have a better structure, with the introduction of Chinese stimulus policies, the overall demand for bulk cargo transportation in 2025-2026 may grow moderately. Versatile ships have greater resilience in response to the demand for grains, energy metals, and technology metals, and the proportion of outstanding orders is still below 10%, providing continued support for shipping rates.
