The demand for LNG ships has shot up this year with orders coming to $4.6bn, the Irish Maritime Development Office (IMDO) said in its Shipping Market Review citing Lloyd’s List.
Twenty-three contracts for the building of new LNG carriers have been signed so far this year, at a rate of almost one a week.
The interest of investors has been attracted by expectations that new cargoes will be introduced into the market once these new ships are in operation.
The arrival of these ships will increase competition among shipping companies for cargoes.
As a result the likelihood is that freight rates will continue to fall. Current spot rates are between $46,000 and $50,000 per day while one-year time charter rates are fixed at $48,000 per day, the Review said.
These rates have decreased significantly since the beginning of the year and with the imminent arrival of new orders it is expected that they will come under further pressure.
The live fleet is 398 ships and the global order book now stands at 128 ships according to Clarksons’ data. This will see a 32% increase to the existing fleet.
[mappress] IMDO, July 16th, 2014