The shipping markets appear to be weathering the storm of a slowdown of the global economy. In its latest weekly report, shipbroker Allied Shipbroking said that “woes continue to mount over the state of the global economy moving forward, further amplifying after the U.S. economy posted an unexpectedly strong drop in the first three months of the year. This is the first contraction noted since mid-2020, with many noting the high inflationary pressure is likely proving to be too much to handle for the majority of consumers.
“If this be the case, then trade in major industrial commodities is going to feel the pain sooner or later. Most feel that we have yet to see markets truly reflect China’s most recent weakening industrial outlook, while given how major a role it plays in most of these commodities, the negative effect is expected to be considerable. For the time being shipping markets have been able to shake off most of this negativity, with rates in the dry bulk market has held up considerably firm (albeit performing at slightly lower levels than what we were seeing during the same time period last year), while the tanker market has even managed to show strong improvement as it rides off the positive tonne-mile gains provided by the most recent supply chain disruptions as part of the crisis in Ukraine. In the case of the dry bulk market, we are still expecting the market to be able to hold off any strong negativity thanks to the restricted growth in the fleet that we experienced over the past 5 years or so”, Mr. Lazaridis noted.
He added that “at the same time the fact that the orderbook has remained at very low levels as well during this time frame ultimately means that it provides a fairly good time window in which a good balance can be maintained (along with comparatively good earnings) even if we were to see a slight slump in global demand. Things are a bit more complicated for the tanker market, with a fair amount of pain having been already dealt with over the past 2 years and all indicators still showing that the most recent improvement could fairly easily evaporate were we to see a strong slowdown in the global economy.
Hello, please leave your name and email here before chat online so that we won't miss your message and contact you smoothly.