Drewry downgrades box volume growth forecast to 3pc this year
LONDON's Drewry Maritime Research as revised downwards its forecast for global container port throughput growth in 2019 to three per cent, or 806 million TEU, down from its earlier prediction of 3
LONDON's Drewry Maritime Research as revised downwards its forecast for global container port throughput growth in 2019 to three per cent, or 806 million TEU, down from its earlier prediction of 3.9 per cent growth. Last year the world's ports saw throughput expand by 4.7 per cent.
The latest issue of its quarterly Container Forecaster report 'highlights concerns of a slowing global economy stoked by the ongoing US-China trade war (albeit paused for the moment), escalating geopolitical tension in many regions of the world and an industry grappling with challenging new emission regulations.'
It also points to other trends that 'could dent demand for shipping in the future, namely the regionalisation of manufacturing supply chains and growing momentum behind a low-carbon, environment-first campaign that has the potential to fundamentally change global consumption habits,' reported American Shipper.
Drewry's senior manager of container research Simon Heaney was quoted as saying: 'We remain confident that world trade will rebound in 2020, but much will depend on developments outside of carriers' control.
'Further spreading of protectionist policies could stunt growth, particularly if the US aims its tariff target at other trading partners. However, there could be some upside for trade if more manufacturing production is relocated outside of China.
'The Asian export powerhouse has progressively reduced its requirement for foreign inputs, choking off demand for intermediate goods, so any shift to less self-reliant economies should give trade a bit of a kick-start,' he said.
Container volume at ports in Asia is predicted to increase above the global average at 3.7 per cent in 2019, down from 4.6 per cent growth in 2018.
In Latin America, container volumes are forecast to fall this year by three per cent, compared to 6.3 per cent growth at ports in 2018. Mr Heaney attributed the contraction to economic and currency issues in Brazil and Argentina.
Drewry also foresees a heightened risk of temporary supply disruption
'In the transpacific market, for example, differences of opinion over the strength of the third-quarter peak season have led to divergent strategies from carriers. Some lines are placing extra loaders into the trade, indicating they expect a repeat of last year's cargo rush, while others are more circumspect, announcing blanked sailings to protect load factors and spot freight rates,' the analysts were cited as saying.
Mr Heaney is cautious about reading too much into the G20 meeting between President Donald Trump and Chinese President Xi Jinping that culminated in the announcement that new tariffs on Chinese imports were being delayed and trade negotiations between the US and China resumed.
While that is positive, he noted in the past such 'set piece moments' have come to naught.
He also said that since the G20, Mr Trump has been 'aiming his tariff gun at the EU,' with his administration proposing possible tariffs on an extra US$4 billion of imports from the European Union, from cherries, cheese and whiskey to coiled copper.
'Carriers can be forgiven for not having all of the answers in such times. One suspects that even Nostradamus would throw his hands up in despair; such is the volatility of the leading characters. There will undoubtedly be some errors along the way and the risk of temporary supply issues has undoubtedly been raised, either from too many cancelled sailings or misplaced capacity transfers between trades,' Mr Heaney said.