The uncertainty brought about by the rapid pace of change also makes shipping industry players more cautious about making decisions about the longer-term future.
Digitalisation will bring transparency to entirely new levels and the industry needs to adapt to this new reality, because it will be one of the key short- and long-term trends.
THE clear trends for the future that emerged from the shipping titans on the panel of the Sea Asia Global Forum that kicked off the Sea Asia 2019 conference in Singapore were that digitalisation is finally having a significant impact on shipping and the near term looks better than the medium to long term.
“The digital age has finally hit shipping,” declared AP Moller-Maersk chief operating officer Søren Toft. He said transparency would be brought to entirely new levels because of this and the industry needed to adapt to this new reality because it would be one of the key short- and long-term trends.
BW Group chairman Andreas Sohmen-Pao said: “Near term [I am] pretty optimistic about the next few years because I think supply-demand is getting quite interesting, longer term I think one has to be very brave to invest in a newbuilding today.”
Elaborating that a fresh order now will only see delivery in 2021 of a vessel that has a lifespan till 2040 or 2045, the head of the group that has interests in both the tanker and gas segments said: “We have no idea what the world looks like even in 2030, let alone in 2040, so if you look at technology shifts, fuel shifts, energy shifts, decarbonisation, I think there is a big question mark for the very long term and we need to be cautious.”
ER Capital chairman Erck Rickmers said: “Everything is driven by technology, which is the big driver of change and will continue to be in the years to come.”
PSA International group chief executive officer Tan Chong Meng said: “What I’ve seen in the past half a dozen years is the most rapid internal change within the industry and the ports as a sector have worked very hard to keep up.”
Responding to the common theme that industries have to adjust to the much more rapid pace of change now, Mr Tan said people in shipping need to be aware of the needs of society in the future and try to reverse engineer that into logistics.
Alluding to PSA’s own plans for the future, he quipped that while the port giant is building out its megaport facilities in Tuas, when the final berth is completed 20 years from now, it may look very different from the first one being laid down now.
On traffic trends for the future, Mr Tan remained confident that PSA and the Port of Singapore had a place. He noted that transatlantic, transpacific and north-south trades generally were growing slower than the world average whereas the intra-regional trades such as the Association of Southeast Asian Nations trades were above it. “There is a lot of population here that has to be served and so we continue to be relevant,” he said.
Mr Toft said: “The rate of change is picking up and so is uncertainty, especially when you have these long-term decisions to make.
“The key is, you must consider the needs of the customers and in doing so you will get a lot of knowledge and feedback on how you should build the future supply chain.”