Danish Ship Finance warns against another newbuilding wave

Danish Ship Finance is concerned that a rate recovery in certain segments could lead to more new ship orders. "Restraint is called for," CEO Erik I.Lassen tells ShippingWatch.

Photo: Danmarks Skibskredit PR

Even though Danish Ship Finance achieved the best result ever for the company in 2014, this far from indicates that the shipping industry has improved overall, says CEO Erik I. Lassen in an interview with ShippingWatch. In spite of certain segments such as tanker - including for instance the LPG market - currently enjoying good times, these positive developments could result in problems, he says.

"As long as shipyard capacity in Asia is as significant as it is right now, we're fundamentally concerned, because the massive shipbuilding capacity makes it fairly easy for the carriers to order ships that can be delivered within a foreseeable period of time. And we also see a risk that shipowners, spurred by brief spikes in the market, might place orders for ships too soon," he says.

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