Many car carriers and few pure ro-ros

	A car carrier built by Kraljevica for Grimaldi.

In April 2004 the ro-ro cargo vessel order book stood at about 120 vessels. In addition, orders for 51 combined passenger and vehicle carriers were listed by LR-Fairplay as well as 14 multi-hull passenger/vehicle carriers. All in all, 185 newbuildings, capable of handling rolling cargoes out of a total of almost 3,600 vessels in the total world order book.

Japan heavily dominates the ro-ro cargo vessel newbuilding market. Japanese owners have placed 51 of the orders and 44 of the ro-ros will be built at Japanese shipyards.

Most vehicle carriers
Most orders for new ro-ro cargo vessels are for vehicle carriers. The average age of this part of the ro-ro fleet is rising and more orders can be expected during the coming year. Although some features will be developed, the car carriers ordered in the near future will be built to pretty much the same design as the vessels ordered yesterday.

As in most other shipping segments, there is, however, a trend towards larger units, shown by two recent orders. The Norwegian investor Peter Gram has ordered two 7,000-car vessels from Uljanik for deliveries in 2007. The vessels will enter into the fleet of HUAL, and Leif Höegh & Co has bought a 49.5 per cent stake in the ships. Also Stockholm based Wallenius Lines is back in the ordering field, by having signed a deal for two PCTCs with Daewoo.

Ro-ros are rare
The vessels will have capacity for 6,700 cars and are scheduled for delivery in the second half of 2006. After delivery, the ships will be put into service for Wallenius Wilhelmsen Lines. Wallenius has also decided to lengthen five existing car carriers, built by Daewoo. By adding 28 metres, cargo capacity will reach 7,100 cars. Excluding car carriers, ro-paxes and fast multi-hull ferries, orders for ro-ros are rare at the shipyards.

According to BRS, the total ro-ro order book stood at 17 vessels by the start of this year. Although being 10 more than 12 months earlier, the figures show that ro-ro owners are very hesitant in a new building market where owners of almost all other vessel types are queuing at the gates of the shipyards. Most hesitant are operators aiming at the charter market. The fundamental reason is the current charter rate levels. These have to rise and stay at more attractive levels if owners are to invest in new tonnage, especially considering the newbuilding prices of today.

Expanding short sea shipping
Ro-ro shipping has never been a “mountain-high, river-deep” market. Comparing with the potential for investments in tankers, bulkers and container ships it will be difficult to attract the capital needed if ro-ro freight rates don’t improve.

Demand for new ro-ro capacity will most certainly rise in the near future. Short sea shipping is expanding in several key geographical areas and last year 21 older ro-ro vessels were sold to scrap. Scrapping of ro-ro vessels could very well increase as the scrap prices continue to rise. Today they are at levels where sending also a smaller vessel from Europe to Alang could be attractive for a chastened owner, especially bearing in mind today’s rate levels in the ro-ro market.

//Rolf P. Nilsson

Latest update 18-10-2006 8:49

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