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Drewry lowers its outlook for world port throughput in 2022 but raises carrier profit forecast
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Fast-rising inflation, ongoing supply chain bottlenecks and the Omicron Covid-19 variant are conspiring to slow container handling growth
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The full-year 2021 estimate for container handling growth was also downgraded to 6.5% from 8.2% in the previous edition
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However, carriers will continue to rake in huge profits, as Drewry forecasts a third year of more than 15% annual growth in total revenue in 2022
Container demand growth is losing some momentum amid mounting headwinds, but carriers will continue to rake in huge profits, according to the latest industry outlook from Drewry.
Drewry’s latest “Container Forecaster” report said fast-rising inflation, ongoing supply chain bottlenecks and the Omicron Covid-19 variant are conspiring to slow the pace of growth in container handling.
This has forced Drewry to lower its outlook for world port throughput in 2022 to 4.6% in its latest forecaster from 5.2% in the previous edition.
The full-year 2021 estimate for container handling growth was also downgraded to 6.5% from 8.2% in the previous edition.
However, carriers will continue to reap tremendous profits, as Drewry forecasts a third year of more than 15% annual growth in total revenue in 2022.
The maritime and shipping industry consultant also again upgraded its annual forecast for 2021 from the previous EBIT guidance of $150 billion to $190 billion, at a margin of approximately 43%.
For this year, Drewry has revised its EBIT forecast to $200 billion, at a margin 37%, noting that quarterly results in 2022 will be smoother but will average out slightly higher than last year’s.
In the third quarter of 2021, ocean carriers posted estimated EBIT of $70.9 billion, “a staggering nine-fold improvement from $7.6bn in the same quarter a year ago,” said Drewry.
Drewry earlier said it would take all of 2022 to fix the supply chain, but now says the emergence of Omicron has added greater uncertainty to the projected recovery timeline, as 2022 is shaping up to be another year of severe disruption, under-supply and extreme cost.
“The pandemic and ensuing supply chain crisis is the primary driver of the supercharged carrier profits and share price bonanza. In simple terms, the longer the congestion lasts, the longer that freight rates and carrier profits will stay extremely high” the report said.
Drewry’s “Container Forecaster” is its flagship quarterly analysis and outlook for the container shipping market.
Photo by Steve Doig on Unsplash
