There are clear signs that global shipping demand is slowing. The latest numbers from DP World show that although throughput in the first quarter grew by 1.7% year-on-year, this is a lower rate of growth than Q1 2021. The Chief Executive Officer of DP World, Sultan Ahmed Bin Sulayem commented that the results for the quarter “saw volume growth [that] has softened due to the strong prior-year performance and uncertain macro environment. However, we continue to see robust growth in markets such as Asia Pacific and the Americas, while in Europe, London Gateway’s strong performance has continued into 2022. The softer volumes in Jebel Ali (UAE) is due to loss of low margin throughput where we remain focused on more profitable origin & destination cargo”.
This performance is similar to other major locations, at least those outside the US. For example, in numbers just released the Port of Rotterdam saw a fall in volumes of 1.4% compared to the first quarter 2021. Container volumes dropped in part due to falling transhipment volumes but also the effects of the various embargoes on Russia. Congestion may have been a factor as well.
Falls in throughput at the Port of Antwerp were even heavier. The number of containers handled in the first quarter fell 11.6% year-on-year, although Antwerp emphasised that 2021 was an exceptionally busy year for its container terminals. All the reasons seen elsewhere, such as action against Russia, contributed but it appears that congestion may be an underlying reason for Antwerp’s heavy fall, with the port stating that “the drop in the container segment, which is partly the result of capacity problems, underscores the urgency of extra container capacity”.
In contrast ports in the US are still seeing very strong demand, with the port of Los Angeles seeing a 3.5% increase in volumes year-on-year in March whilst East Coast ports, such as Charleston, also continue to boom.
It is probably reasonable to assume that whilst China is still in some sort of COVID crisis, the rest of the world is moving to a new market conditions. However, in this market it would appear that US growth still remains strong despite the impact of inflation on consumer demand. How long this lasts will be a key issue.
Source: Transport Intelligence, 26th April 2022
Author: Thomas Cullen