• Products: 
• List all
• |
• INSIGHTS
• |
• FORECASTERS
• |
• BRIEFING REPORTS
• |
• SPOTLIGHT REPORTS
• |
• ANNUALS
• |

Container Market Annual Review and Forecast 2009/10

Related Publications:

R0911 Container Market Annual Review and Forecast 2009/10

The container industry has not had a good or consistent record in crisis management. Carriers, owners, shippers, terminal operators, yards and banks have to work through this crisis and there is little point in taking a non-committal stance to one side because all parties are now inextricably linked, having formed complex relationships concerning, in particular, credit and contractual lines for the financing and delivery of a huge backlog of ships. This, apart from the collapse in global container traffic is at the very heart of the current problems.

The rules that prevailed last year no longer apply and there will be a different landscape in 2010 and beyond – companies will go bust, new partnerships will be formed, freight rates and the charter market may take years to recover to previous levels, as may asset prices. The industry is already adapting to fewer services and the fact that as much as 8-10% of the current global fleet may be in either hot or cold lay-up.

It is expected that there will be some minor recovery in trade flows for 2010 (+2.4%), but together with another hefty dose of capacity injection (+7.9%), the supply/demand balance will not just remain awful, but actually deteriorate further. While freight rates have been improving of late, this is of course counter-cyclical and it will be a huge test of carriers’ resolve and ability to maintain this momentum while at the same time continuing to effectively manage the supply side of the equation.  

Drewry is projecting that average all-in east-west rates will climb rather encouragingly by 18% next year, but this has to be put in context against the enormous decline in 2009 (27%) and the fact that this does not even put rates back up to the same levels as 2006. The task ahead for carriers is huge, given that their recent successes do not even bring them back to break-even levels. If ever there was a need for genuine cost-plus pricing in container shipping, now is that time.

Return to news article listing...

• For further information:
• Call: +44 20 7538 0191
• Email: enquiries@drewry.co.uk

Drewry Shipping Consultants Limited, Drewry House, 213 Marsh Wall, London, E14 9FJ, England.
© Copyright 2009 ~ Drewry Shipping Consultants Limited. All Rights Reserved. Terms of Use | Privacy Policy