The global shipping industry needs confidence and patience in facing great challenges of the current financial crisis, said business leaders at the ongoing 2008 World Shipping (China) Summit in Dalian of Northeast China's Liaoning Province.

"The global shipping market is in a panic now," said Wei Jiafu, President and CEO of COSCO Group, quoting the Baltic Dry Index, which slumped from 11793 on May 20 to 1102 on October 24.

Wei said the industry is hurt as demands for container, dry bulk, and oil tanker are all reduced. OPEC has announced to cut production, while some Chinese steel mills also choose to cut their output.

"Containers traffic volume for 2008 as a whole is now projected to be 5.5 percent less than the 2007 traffic volume, with no turnaround expected in the next six months," he quoted sources.

Wei was echoed by other attendees at the summit, the world's most influential shipping forum, which attracted top players of the global shipping community.

The market is strongly affected by the financial crises, said Mark Long, Head of Global Shipping of HSBC.

"Nobody can predict when it will recover," Long said.

"Periodic fluctuation is not uncommon in the shipping market," said Xu Zuyuan, Vice Minister of the Ministry of Transport of the People's Republic of China.

Xu suggested all the business players to cooperate in order to reach a win-win situation and a sustainable developing trend in the slumping market.

"The panics will be over in months. But worries are still there. We need confidence to recover," Wei Jiafu commented.

According to Wei, there are many positive factors for the further development of the shipping industry. Governments of giant economies like the United States, Euro area, Japan, and Russia are taking measures to bail out. The Chinese economy keeps growing steadily. The shipping demand remains strong.

"Global dry bulk volume is projected to grow by 5.2 percent in 2008, and 3.5 percent in 2009," said Wei.

China's oil tanker demand is still strong. China's crude oil import reached 140 million tons in the first three quarters of 2008, with a year-on-year increase of 8.8 percent. The figure is expected to reach 180 million tons at the end of the year, he said.

Wei regarded the challenge a chance to optimize the structure of the industry. With orders of bulk ships being cancelled, single-hull tanker being phased out, and speculation leaving, the shipping capacity will be strengthened.

(China Daily November 7, 2008)