Oversupply of bottoms in the international trade will remain a major issue for the shipping industry in the near term, according to the United Nations Conference on Trade and Development (UNCTAD) Review of Maritime Transport 2010 report.
The trend will likely continue especially since seaborne trade is declining and is now below its 2007 level after reaching fresh highs in 2008. UNCTAD said the total seaborne trade in 2009 was at 7.84 billion tons.
Although a global recovery is now underway, the report noted this to be uneven and slower than recoveries that have followed previous recessions due to fragile global economic conditions.
"The supply of new vessels showed no signs of abating," the report revealed. "At the beginning of 2010, the world merchant fleet reached 1,276 million deadweight tons (dwt) – an increase of 84 million dwt over 2009. This growth resulted from record new deliveries of 117 million dwt, compared to demolitions and other withdrawals from the market totaling about 33 million dwt."
It added, "New deliveries in 2009 were 42% higher than in 2008 because of the orders that had been placed prior to the downturn in global demand. The resulting oversupply of tonnage then led to an over 300% surge in demolitions of older tonnage. However, despite this increase, the combined effect of a downturn in demand and an oversupply of vessels meant that freight rates for many vessel types remained depressed."
Meanwhile, the world container port throughput declined 9.7% to 465.7 million twenty-foot equivalent units (TEUs) in 2009, the report said.
The average ranking of the least developed countries (LDCs) in 2010 was 111, compared to an average ranking of 78 for other developing countries and 64 for developed countries. The rating indicates that LDCs remain isolated from major or frequently serviced shipping routes. Between 2004 and 2010, the connectivity ranking of LDCs improved by just one point.
Seaborne trade in dry bulk commodities, on the other hand, grew by an estimated 1.4% in 2009.
UNCTAD’s yearly Review of Maritime Transport looks at transport developments in a particular region. The focus for the 2010 edition is Asia.
Gross domestic product growth in the Asia-Pacific region decelerated to 4% in 2009 – the lowest in eight years. In tandem with the economic situation, growth in international merchandise trade in the region decelerated in 2008 and contracted in 2009. By 2010, economic indicators were showing a recovery in the region’s economic growth and trade, with some economies already showing signs of a return to pre-crisis growth and export levels. However, the recovery remains fragile and is subject to downside risks.
