Grim outlook for operators: Drury once again downgraded its growth forecast for container shipments

The outlook for container shipping has worsened over the past three months, leading Drury to downgrade its full-year growth rating.

This is particularly unwelcome news for operators, given the 0.5 per cent sulfur ceiling imposed by the International Maritime Organization ((IMO)) on marine fuel (which will become law on January 1). Operator costs will face the challenge of survival competition in the coming quarters. 

Mr Drury said global port throughput was now expected to grow by just 2.6 per cent this year, compared with the previous forecast of 3 per cent. 

Simon Heaney, editor of, Container Forecaster, senior manager of container shipping research at Drury, says the risk of depressing the container shipping market appears to be growing. 

Heaney said a series of new problems have worsened the situation, masking further concern and uncertainty in the market. 

He added that while port statistics were strong and consumer demand was resilient in the first half of the year, a number of key indicators fell sharply, which affected the thinking of consulting firms. 

In July, the IMF cut its forecast for world trade growth in goods and services by 9 percentage points to 2.5%, warning that global price growth would continue to weaken, citing the consequences of the trade war between China and the United States. Geopolitical tensions have increased and energy uncertainties have increased. 

The performance of shipping companies was hampered by the disappointing financial position of the container shipping industry in the first half of the year, followed by weakness in the peak season, which hampered the performance of shipping companies, and the analyst pointed out that the impact of IMO2020 was the new major risk for container shipping companies. 

Drury's current estimate is that container shipping companies will face an additional $11 billion in fuel bills related to the transition to low-sulphur fuels.Part of the cost will be incurred in the last quarter of this year, when marine fuel tanks are retrofitted to apply low-sulphur fuel oil. 

Nevertheless, Drury stated that the assumption of its work was that the carrier would be more successful in recovering the additional costs associated with IMO2020 than in the past. 

In the SECA (sulfur Emission Control) regions of Europe and the United States, carriers have failed to compensate for previous significant increases in fuel prices or the higher costs of ultra-low sulphur fuels. 

But this time the stakes are much higher, Drury warned that some container shipping companies may need to take drastic action to avoid bankruptcy. 

In this case, the carrier will endeavour to protect cash flow through a number of measures, including best efforts to limit capacity, including further slowing down the speed of navigation, increasing the number of blank voyages and chartering ships, Heaney said. 

"but, in a more positive conclusion.""most shippers accept that they have to pay more for green transport, which makes it incumbent on carriers to justify the surcharge through reliable and reliable mechanisms," he said. "