"Our business has experienced significant growth in the past 12 months, largely driven by the biofuel sector and related feedstock movements, which now constitute 50-60% of our portfolio."
What are some recent developments and achievements at New Asia Shipbrokers (NAS)?
Our business has experienced significant growth in the past 12 months, largely driven by the biofuel sector and related feedstock movements, which now constitute 50-60% of our portfolio. This was followed by chemicals, vegetable oil, and petroleum products. Last year’s growth was largely a result of various imbalances in the global market, caused by factors such as the pandemic, wars, demand and supply imbalances, port congestion, and low-interest bank rates.
Despite our size, our reputation has grown, allowing us to expand our business organically.
Could you describe the consultancy services offered under the name New Asia Shipping?
New Asia Shipping is an added avenue we provide for clients who have limited knowledge about the shipping industry but require their services, nonetheless. It allows us to offer a more holistic approach, beyond just brokering. We navigate the complex commercial process on our client's behalf, manage all operations for them and ensure they get better value for their money. We have offered this service to a few clients, especially during the pandemic, and it proved beneficial in keeping costs low.
Have you seen any shifts in the types of charterers you are receiving, specifically in the Singaporean chemical sector?
There has been a decrease in chemical charterers, especially on the commodity side. These changes are mainly due to the global economy and China's significant role in driving demand for chemicals. The Chinese economy is not performing well and their ongoing property crisis along with financial regulations by the government have affected their consumption levels. At the same time, China is becoming more self-sufficient, building more plants within the country and securing oil supplies through deals with major oil producers, Aramco for example. This could hurt the specialized chemical shipping sector here.
China continues to import but the growth rate of imports has slowed down considerably.
Have there been significant strides in progressing with ESG over the past year?
Regrettably, I do not see much progress in terms of ESG, particularly in achieving a carbon-neutral future. While some bigger corporations with strong corporate governance do make efforts to show support to ESG, they are not representative of the entire shipping industry. The industry is a collective of ship owners, and I believe the situation remains much the same as last year. The challenge lies mainly in implementing carbon neutrality in the specialized tanker sector. The operations on board ships are numerous and diverse, making it complex for ship owners or charterers to monitor fuel consumption accurately. Some processes like heating products onboard or cleaning the tanks can significantly add to the fuel consumption for the voyage.
What are Singapore’s strategic advantages?
As a shipping hub, Singapore is comparable to London, boasting a diverse ecosystem of different services and stakeholders in the shipping industry, including traders, charterers, ship owners, and brokers. It has also proven its resilience and growth potential, especially during the pandemic when it attracted numerous businesses from Hong Kong. However, Singapore also has its own set of challenges. While there is a significant talent pool, competition can be fierce with many companies vying for the same talent. Graduates from local universities often have high aspirations, preferring to work with large, prestigious companies that offer social benefits and safety nets. The shipping industry, and the specialized sector in particular, is not the top choice for many of these graduates. It is partly due to the lack of advocacy from the maritime sector about the job scope and potential within the shipping industry. Most university courses focus on dry cargo and containers, not tankers, leaving the specialized tanker sector unfamiliar to many.
Having just celebrated your 10th anniversary, what are your future plans?
Our plans revolve around providing decarbonization-related services to our clients. We are also focusing on biofuels, which we believe are key to the survival of the petrochemical industry. With a significant rise in renewable fuel capacity, it is also important for the industry to find solutions for the effective disposal of plastics. As such, we are excited about companies like Neste, one of our major clients and the world’s largest players in the renewable fuel sector, who have started recycling plastic to produce petroleum products.