The outbreak of the coronavirus has sent the world into a recession and currently, as the cases have just surpassed the 1 million mark, the light at the end of the tunnel seems distant.
As global economic growth deteriorates, the outlook for the commercial shipping markets in 2020 continues to worsen. Parallels are drawn to the financial crisis of 2008-09, but the global economy and shipping markets are currently faced with a pandemic, a radically different challenge to deal with.
To light the tunnel as we pass through it, BIMCO will host the Perspectives and insights on shipping amidst a pandemic webinar on 14 April 2020. The 1-hour webinar will touch upon how the coronavirus has impacted the commercial shipping markets and what the future may hold.
BIMCO has invited two industry experts to provide their take on what the implications are for the different shipping markets.On container shipping, Alan Murphy, CEO & Founder of Sea-Intelligence, will set the scene and provide unique insights on how the liner industry is faring amidst massive headwinds.
Russel Thomson, CEO & Founder of Tradeviews, which specializes on dry bulk trade flows and developments, will provide his take on how the dry bulk market feels the fallout.
Lastly, BIMCO’s own Chief Shipping Analyst, Peter Sand, will present the global macroeconomic outlook, but also examine how the oil tanker market is impacted.
BIMCO’s Communications Director, Rasmus Nord Jørgensen, will moderate the webinar.
The webinar takes place on 14 April 2020, 10:00AM CET and is streamed for free on BIMCO’s YouTube channel. Tune in at the link below.
It remains to be seen for how long these conditions will prevail, but global shipping markets feel the pain when the global economy contracts.
Container shipping stands to take the brunt of the coronavirus impact given the high reliance upon economic stability in advanced economies. With major economies temporarily under lockdown, restricting consumer spending, the demand for containerised goods diminishes. Carriers have already blanked record-breaking amount of sailings and idle container capacity remains at the highest levels ever.
Dry bulk shipping, which is more reliant upon China, remains on a perilous course. As the Chinese economy starts to recover it could lift freight rates back to profitability. Yet, as the rest of the world struggles to contain the coronavirus this scenario remains fraught by uncertainty. Currently, the freight rates are not enough to cover the break-even costs.
Meanwhile, a very different set of variables rule the oil tanker shipping market, geopolitics being the dominating one. With OPEC+ negotiations falling apart on 6 March and Saudi Arabia initiating an oil price war through increased crude oil production, the crude oil freight and time-charter rates have soared. Nonetheless, these conditions will not last forever and once the OPEC+ parties reach some sort of an agreement, the impact of the coronavirus will certainly start to make itself felt.
The impact of the coronavirus and the oil price war has plummeted oil and bunker prices with the West Texas Intermediate (WTI) dropping 66% through the first quarter of 2020. For non-scrubber fitted ships, the lower costs of bunkering provide some relief to shipping markets in times of massive uncertainty.
Follow along in the BIMCO webinar on 14 April 2020, as the experts provide their take on how the volatile markets will fare amidst the challenging conditions.
Access BIMCO's COVID-19 related articles and advice.
Veritas Petroleum Services (VPS) publish regular Bunker Alerts based entirely on fuel samples and have kindly permitted BIMCO’s Members to access this information.
The Bunker Alerts are not intended to be an evaluation of overall bunker quality in the port or area concerned, but usually highlight a specific parameter within the fuel which has raised a quality issue.
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