More insolvencies ahead

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During the Container Trade Europe Conference in Hamburg, experts warned that further[ds_preview] mergers, acquisitions and insovencies were very likely to happen in the near future. Jens Rohweder, managing director of Notos Consult, said debts of some liner carriers in Far East and Southeast Asia were at an alarming level. Accordingly, more cases of bankruptcy like Hanjin Shipping were possible. Generally speaking, he said he was less concerned about small carriers than about big ones.

Between January and May 2016, insolvencies within the maritime industry have increased by 10%. Credit insurer Euler Hermes did not see the trend for consolidation to end soon. Examples from the container sector show that the industry is still suffering from overcapacity, freight rates and charter rates at a record low and the sluggish global trade development – with a domino-effect on financing funds and banks, since a lot of chartered vessels return to their owners. According to Euler Hermes this caused a chain reaction and hit mainly smaller owners who had just a small number of vessels.