Profits and container shipping are seldom mentioned in the same sentence these days, but for the more positive bulk business, the glass appears to be half full.
The balance between growth in the dry bulk shipping market and the growth of its vessel fleet has set up the business for a couple of highly profitable years.
According to an investment bank, demand for dry bulk shipping will increase eight to nine percent this year, and around six to seven percent in 2011. The bank also predicts that the growth of the dry bulk fleet will increase at the same rate.
If that is indeed how the next two years will play out – let’s not forget that investment bankers led the world down the road to ruin not so long ago – the bulker business will be a very profitable one.
Already reports are coming in of Capesizes earning an average of around US$50,000 a day, Panamaxes half that and Handymaxes up to US$20,000 a day.
Resurgent China trade is playing a leading role in the growing bulk market. Its manufacturing and export industries are again working at top speed and the government stimulus package ensured that imports of iron ore, coal, crude oil and other major seaborne commodities soared to record levels.
Monthly imports of crude oil and soybeans rose sharply last year, as did iron ore and copper, and aluminium and steel exports were pretty healthy, too.
China also last year became a net coal importer for the first time and opened new trade lanes to South America and Africa to support its ever-growing need for energy.
So it seems that in the raw materials business, China is once again on top of things. Manufacturing output is up, as is power consumption, a better reflection of the economy than the often dodgy GDP numbers.
Let's hope the next two years are indeed good ones for the bulk business, and that all this activity somehow finds a way to filter down to container shipping, which could certainly use a little help. Or a lot.