Seafarer supply the dominant theme as owners opt for outsourcing contracts, writes Nigel Kitchen

AS international fleets grow, it is an accepted fact that third party shipmanagement is becoming more and more dominant and well perceived in the marine industry.

This view, held by Marlow Navigation’s general manager, Andreas Neophytou, is backed up by InterManager general secretary Guy Morel who says the image of shipmanagement is improving.

“Shipmanagement is becoming more important within shipping,” commented Mr Morel. “Shipowners see managers now as very important, particularly for crew supply.

“The number of ships using some form of third party shipmanagement is large.

“I would not be surprised if about 50% of the world fleet has some form of outsourcing agreement between an owner and another party.”

Ole Stene, managing director of Manila-based Aboitiz Jebsen Bulk Transport Corp and InterManager president, believes shipmanagers are now looked upon by shipowners as being professional and offering the relevant competencies.

“Not all owners have the in-house resources to deal with, for example, the huge amount of [shipping] legislation, so will employ shipmanagement professionals to handle such areas,” he said.

“We think the [shipmanagement] sector is buoyant at present,” commented Columbia Shipmanagement’s managing director Dirk Fry.

“Although there are a number of difficulties being faced by our industry, there is still a lot of growth potential in the shipmanagement sector for companies providing a good service.

“The development of InterManager has been positive.”

A note of caution is sounded by Meridian Marine Management’s managing director, Alastair Evitt, who believes that, on the whole, the upturn in the market has been good for shipmanagement.

“With higher income we have seen that shipowners are prepared to pay more to ensure the continued and uninterrupted operation of their assets,” he said.

“The flip-side for third party shipmanagement is that there has been a trend towards owners taking all, or some, of the management functions ‘in-house’.”

Another less than optimistic view is expressed by Robert Thompson, first deputy managing director of Unicom Management Services (Cyprus), who reckons the sector has faced an increasingly difficult business environment with some costs escalating dramatically, such as bunkers and spare parts.

“There remain real constraints in crewing, where it is becoming harder to attract and retain seafarers with the right skills and capabilities,” he explained.

“There has also been a virtual freeze in the sector’s management fees.

“Meanwhile, the world’s fleet has continued to expand, further exacerbating the pressure on the industry’s already stretched resources.”

The increasing amount of tonnage coming under third party shipmanagement is causing problems for the sector because of the scarcity of officers,according to Andreas Droussiotis, chief executive officer of the newly-established Bernhard Schulte Shipmanagement Group.

He said: “Of course, the oil majors, port state control requirements and other flag and class needs make it even more difficult to cope.

“The fun seems to have long gone. The only relief we all have is that owners are willing to pay a fairer fee now for the management of their vessels.”

Many companies are growing through acquisition, which in turn means there is a degree of consolidation within the shipmanagement sector, but the most notable change last year was the emergence of the Bernhard Schulte Shipmanagement Group — which saw the grouping together of established names Dorchester, Hanseatic and Eurasia under one banner.

The group now has three distinct fleets: LPG and LNG, oil and chemical tankers, and dry cargo under three different managing directors.

Mr Droussiotis said: “Under this scheme all up front operations remain unchanged. The primary reason for grouping ourselves is the change of the shipping environment, the effort to enhance the service to our clients and also to offer more opportunities to our staff at sea and ashore, and, of course, to make use of economies of scale for us and our clients and increase our profitability by cutting down on duplicated services.”

While the last 12 months have been a success story for most of the prominent shipmanagement companies as the world fleet has grown, new challenges have been added and the demand for highly professional and safer operations, from both shipowners and their clients, have also been escalated to new heights.

Kishore Rajvanshy, managing director, of Fleet Management, commented: “The customers have become more quality conscious and it is my firm belief that in the days to come only shipmanagers with highly evolved safety management systems and good IT support will be able to survive.”

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