Feb.14--THE shipping industry is in crisis so deep that the boss of the giant Maersk Group says conditions are now tougher than after the global financial crash, reports London's Financial Times.

"It is worse than in 2008," said Nils Anderson, chief executive. "The oil price is as low as its lowest point in 2008-2009 and has stayed there for a long time and doesn't look like going up soon.

"Freight rates are lower. The external conditions are much worse but we are better prepared," he said.

The Baltic Dry Index, a benchmark for the health of the global shipping industry, has fallen to all-time lows.

"Given our expectation that the oil price will remain at a low level for a longer period, we have impaired the value of a number of Maersk Oil's assets," Mr Andersen said. 

"We will continue to strengthen the group's position through strong operational performance and growth investments," he said.

Jonathan Roach, container market analyst at shipbroker Braemar, said the industry is being squeezed from all sides.

"Global trade growth is basically flat and there's chronic overcapacity within the shipping sector that is not going to go away any time soon, especially with lots of new ships due to come into service," he said. 

"If you ignore the period just after the financial crash in terms of growth, then last year was the worst we've ever seen and it could be almost zero this year," Mr Roach said.

The opening of the widened the Panama Canal over the next few months, he said, will only see pressure on shipping lines to scrap smaller and older vessels as larger and more efficient ships will be able to use the waterway.

(Source:shippingazette)