- Container and Dry Bulk Face Weak Demand as Fitch Downgrades Outlook.
- Fitch Warns of 2025 Shipping Slowdown Amid Tariffs and Overcapacity.
- Tanker Segment Holds Steady as Container Profits Plunge.
Fitch Ratings has revised its outlook for the global shipping industry in 2025, downgrading it from ‘neutral’ to ‘deteriorating’. This change is largely due to weaker demand expectations across key segments, especially in container and dry bulk shipping, reports Fitch Ratings.
Container Shipping Faces Sharp Profit Decline
The forecast for container shipping profits in 2025 shows a significant drop compared to 2024. Last year’s profits were bolstered by disruptions in the Red Sea, which temporarily pushed freight rates higher. However, container volumes in 2025 are anticipated to remain flat or even dip slightly compared to 2024, impacted by new U.S. tariffs and a slowdown in global trade.
At the same time, fleet capacity is expected to increase by about 6%, which will worsen the supply-demand imbalance. Even if demand picks up due to easing trade tensions, the surplus supply is likely to keep freight rates under pressure.
Freight Rate Risks and Tariff Impacts
Fitch predicts that container freight rates will continue to decline from their peaks in mid-2024. While there may be short-term spikes due to shifts in demand and port congestion from tariff-related inventory pulls, rates will still be pressured by a potential normalisation of traffic through the Suez Canal, which could enhance effective capacity by over 10%.
Further complicating matters is the U.S. Trade Representative’s proposed port fee scheme, which could impose charges of up to USD120 per container for non-Chinese operators using Chinese-built ships starting in October 2025, with fees rising to USD250 by 2028. Additionally, Chinese-owned vessels may incur further charges. As a result, container companies are likely to rethink their networks to mitigate cost impacts.
Dry Bulk Outlook Remains Weak
The outlook for dry bulk shipping isn’t looking too bright, with only a slight increase in volume expected for 2025, primarily driven by demand from China. Global shipping volumes are projected to remain steady, while capacity is set to grow at a modest pace of low to mid-single digits. This ongoing imbalance is likely to keep freight rates under pressure.
Fitch predicts that China’s GDP growth will stay below 4% in both 2025 and 2026, a drop from the over 5% average we’ve seen in recent years. On a global scale, GDP growth is also anticipated to slow down, with estimates of 1.9% in 2025 and 2.0% in 2026, down from 2.9% in 2024.
Tanker Segment Shows Relative Stability
On a brighter note, the tanker shipping market is holding up relatively well, buoyed by strong demand for tonne-miles, especially for oil moving from west to east, and the possibility of increased oil storage activity due to low oil prices. The order books for tankers are fairly balanced with the ageing fleets, which helps to limit any significant capacity increases.
Risks and Uncertainties Ahead
Fitch points out several risks facing the sector, such as potential further weakening of the macroeconomic environment and the possible normalisation of shipping routes in the Red Sea. However, any regulatory changes or new sanctions could limit the effective capacity of fleets, which might help support freight rates.
In the container shipping arena, supply-chain bottlenecks caused by shifting trade routes or new tariff policies could temporarily push rates up, even as the overall trend remains weak.
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Source: Fitch Ratings
