Container capacity growth at ports from channel-deepening projects to cargo terminal construction is expected to shrink at least 40% over the next five years as port operators reconsider expansion amid the pandemic-driven slump in global trade.
Drewry Shipping Consultants Ltd. said in a new report issued Tuesday that it expects boxship terminal capacity to grow by an average 25 million containers a year, well below the annual average increase of more than 40 million containers that was added over the past decade.
The forecast could be cut even further if there is a resurgence of coronavirus infections and forces another round of lockdowns around the world, the London-based maritime consultancy said.
“Our five-year forecast for global container port handling has been cut back drastically due to the Covid-19 pandemic, and the risks remain heavily weighted to the downside,“ said Eleanor Hadland, Drewry’s senior analyst for ports and terminals.
She said port operators are actively reviewing scheduled projects as a result of falling global economic growth and uncertainty over the short to medium term.
While big port works commissioned for this and next year may be delayed, Ms. Hadland said “projects which are currently at an earlier stage of planning, particularly where construction contracts and equipment orders have not yet been tendered, suspension or cancellation is more likely if market conditions remain poor.”
The report comes after container operators have cut sailings by around 30% over the past five months as demand for consumer goods like clothing, automobiles, electronic goods and home appliances has fallen back.
London-based maritime data provider Clarksons PLC said new orders for all varieties of ocean-going vessels, including container ships, were down 53% from a year ago in the first half of the year.
Global trade is expected to fall by between 13% and 32% in 2020 as the pandemic continues to disrupt normal economic activity, according to the World Trade Organization, which estimates that global merchandise trade volume declined 18.5% from a year ago in the second quarter.
Write to Costas Paris at [email protected]
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