Fitch: Challenges for Asia shipping

Fitch Ratings said in a new report that the majority of the shipping companies in Asia will continue to face significant operating and credit challenges in 2010.

Of the seven Asian shipping companies rated by Fitch, three have a negative outlook or are on negative Rating Watch, including PT Arpeni Pratama Ocean Line Tbk, PT Berlian Laju Tanker Tbk and Varun Shipping Co.

Thoresen Thai Agencies plc, Essar Shipping Ports and Logistics Ltd. are expected to achieve revenue and profit growth in 2010, the agency said, but as a result of the growth in non-shipping services. First Ship Lease Trust has limited long-term volume headroom, Fitch added.

Weakened earnings, high committed capital expenditure and restricted access to capital remain challenges for a number of rated shipping companies, Fitch said.

The oversupply of shipping capacity will continue to exert pressure on shipping rates and utilization levels in 2010, the agency said.

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