Kristian v. m ø rch, CEO of ODFJELL, one of the world's largest chemical shipping companies, said in a recent media interview that it is expected that ODFJELL's revenue may exceed US $1 billion in 2020 and its operating performance will double to US $125-130 million. He is optimistic about the chemical tanker market in 2021.

Kristian v. m ø rch, CEO of ODFJELL, the world's second-largest chemical shipping company, said that in fact, the past year (chemical shipping market) was the best year since 2008.

Despite the global economic cyclical blockade caused by the coronavirus pandemic and the comprehensive travel restrictions imposed to control infection in the past year, the chemical carrier market has been largely unaffected. On the contrary, in the second quarter of this year, the market prospered because customers hoarded inventory for safety. In the rest of 2020, the performance of the chemical carrier market is also very positive.

In addition, ODFJELL also expects that the market will continue to be optimistic in 2021.

M ø RCH said, "from the perspective of supply and demand, this is also one of the strongest years in the chemical tanker market in 25 years. We see growth every quarter, which shows that the market is quite strong."

Growth will accelerate in 2021

The positive development of the chemical ship market in 2020 is largely driven by the inflow of less new shipbuilding into the market, which is mainly due to the reluctance of many companies to invest. Under the premise of carbon emission reduction, shipping companies are not sure which fuel and emission reduction technology should be selected to make their new ships best meet the increasing environmental requirements.

At the same time, it is true that demand growth in 2020 is also higher than expected.

The CEO also said that if countries around the world successfully control the continued spread of covid-19 with the help of vaccination programs that have been launched, it is expected that the global economy will accelerate in 2021.

Last year, the demand for chemical products in most industries using chemical products remained stable to some extent. However, one exception is the automotive industry and the construction industry.

In its latest interim report for the third quarter of 2020, ODFJELL assessed that if the growth rate of the chemical tanker market is to continue to grow and the inventory is to remain "normalized", the two industries need to return to normal as soon as possible and increase the procurement of chemicals.

In this report, ODFJELL also predicts that the demand of the chemical tanker market will increase by an average of 3% from 2021 to 2023. However, the transportation capacity of chemical ships will maintain a low growth rate, with an increase of only about 1%.

M ø RCH said that this is also an important reason why we are optimistic about the full year expectation of 2020 performance and full of confidence in 2021.

But we also need to remain in awe of this uncertain future

Optimism does not mean recklessness. M ø RCH also said, "(while maintaining optimism) We are not naive. We estimate that there may be a risk of major adjustment in the global economy. Some countries are heavily indebted, the interest rate is almost zero, and the stock market has set new records one after another. If the global economy is in recession, it is hard to imagine that we will not be impacted. That is why we should continue to maintain self-discipline in our business. We have been trying to reduce potential losses "Risk in the future."

It estimates that if a simple forecast is made for the performance of the whole year according to the performance of the third quarter, the company's revenue this year will reach nearly US $1 billion, and the operating performance before tax and financial cost will reach US $125-130 million. If this performance is finally confirmed, it will be twice the operating performance in 2019.

ODFJELL has been updating its fleet in recent years, and now the company has almost reached its previous goal of operating 100 ships. This is achieved in part through cooperation with navig8 chemical tankers and TRF, two other tanker companies.

"We have completed our fleet renewal plan, so there is no uncertainty in our investment plan. We can focus on operations," said the ODFJELL executive.

ODFJELL group's largest revenue currently comes from the chemical tanker market, but the group also has port terminal business and very small natural gas ship business. Over the past four years, the company's terminal business has been shrinking, and about two-thirds of its business has been sold.

M ø RCH said, "the rest is more profitable and we can all make money from it."