The shipping industry’s outlook is characterized by a combination of mixed factors. Cargo growth is experiencing a slowdown, but the focus is currently on capacity, which is considered the key factor to monitor. Although the container segment is preparing for a significant influx of capacity, the number of new tanker orders remains limited. This, coupled with a rebound in oil demand and the utilization of longer trade routes, is resulting in a tight market and sustained high freight rates over an extended period.
Global trade is changing and so is shipping
At the conclusion of 2022, global trade experienced a contraction due to the adjustment of accumulated inventories and the economic stagnation observed in the United States and Europe. The geopolitical concerns, protectionist measures, and reevaluation of supply chains have further contributed to a period of reduced growth in global trade. As a result, shipping tonnage is facing challenges, and growth is anticipated to remain modest throughout 2024. However, there is an expectation of a more robust performance in the latter half of 2023 as consumer spending on goods picks up, spending patterns normalize, inventories decrease, and wage growth is observed.
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Source: Think.ING
