The International Maritime Bureau said in its annual report that 191 piracy incidents were recorded worldwide, down from 246 in 2015 and the lowest level since 1998.
It said pirates hijacked seven vessels and held 151 hostages, down from 15 ships and 271 hostages in 2015.
However, it said maritime kidnappings surged by threefold to 62 people from just 19 people in 2015.
"The continued fall in piracy is good news, but certain shipping routes remain dangerous, and the escalation of crew kidnapping is a worrying trend in some emerging areas. The kidnappings in the Sulu Seas between eastern Malaysia and the Philippines are a particular concern," bureau director Pottengal Mukundan said in a statement.
In the last quarter alone, the bureau said 12 crew were kidnapped from two cargo vessels that were underway and from an anchored fishing vessel in the Sulu Sea.
The bureau, whose piracy reporting center is based in Kuala Lumpur, urged ship owners to consider avoiding the Sulu Sea.
It called on governments to investigate and identify the kidnappers and punish them under the law.
It urged ships to be vigilant in the Gulf of Guinea, which remained a high-risk kidnapping hotspot with 34 seized from vessels in nine incidents.
Worldwide, Indonesia remained the top hotspot for piracy with 49 incidents, mostly low-level thefts, but this was sharply down from 108 in 2015.
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