CONFIDENCE levels in the industry rose to their highest level this year, at the end of August, according to the Shipping Confidence Survey from marine accountants Moore Stephens.

Respondents were mostly concerned about low freight rates and over-tonnaging, with continuing doubts also expressed about private equity funding.

In August 2015, the average confidence level expressed by respondents in the markets in which they operate was 5.9 on a scale of 1 to 10. This compares to the 5.3 recorded in May.

All main categories of respondent recorded an increase in confidence in this survey, most notably charterers (up from 4.2 to 6.5) and owners (up from 5.1 to 5.8). The confidence expressed by brokers, meanwhile, was up from 4.8 to 5.2, and that of shipmanagers from 6.1 to 6.4.

While some respondents were confident that the shipping markets would improve in line with economic developments, others were more cautious. 

"The shipping markets have been over-stocked, and there has been far too much interest from non-traditional shipping sources with no real clue how these intricate markets work," said one. 

"Once built, the ships are there! The low oil cost means the drive for alternative fuels and cheaper propulsion is not being followed as diligently as one might have expected," he said.

There were the usual concerns expressed about too many ships and too little scrapping. 

Increased regulation was another bother, with one respondent complaining, "Regulations are going to kill us!"

Another respondent emphasised, "Current market conditions realistically reflect tonnage oversupply in all sectors. Until this corrects itself, global trade patterns will skew supply over demand."

Another said: "Expect a static trend for the next few years. It might require a major conflagration to kick-start the industry. That may sound unpleasant, but without it we are in for a lengthy stay in the doldrums."

"Everything seems to be operating on the two-steps-forward-and-one-back principle, alternating with the one-step-forward and two-back principle!" said another, while one said: "Today's shipping market is really competitive."

Respondents who expected finance costs to increase was up to 48 from 40. The shift in sentiment in this segment was most notable among owners, up from 35 to 53 and charterers from 33 to 50.

Competition, demand trends and finance costs featured as the top three factors cited by respondents as those likely to influence performance most significantly over the coming 12 months.

There was a fall in the number of respondents expecting higher freight rates in the tanker and containership sectors, but expectations of improved rates in the drybulk trades were up on the figures for May 2015. 

"The respondents to our survey are asked to comment on their industry expectations over the coming 12 months. Many of them, however, are also interested in the longer-term view, and the portents here are generally encouraging.

"First, world population is growing. At the end of 1970, it was 3.7 billion. The UN says it will hit 8.3 billion to 10.9 billion by 2050. This creates and sustains demand for shipping services - good news for the industry.

"In 1970, IMF recorded global GDP growing 3.7 per cent. By 2000, the figure was 4.8 per cent. Today, it is 3.5 per cent, but expected to climb rise near four per cent by 2020 - which is good for shipping.

"So the long-term outlook for shipping offers encouragement to existing and new investors alike. Those who are not attracted by the longer-term prospects, meanwhile, will doubtless exit the industry, and in the process may help solve some of its problems," he said.