BIMCO has released its Dry Bulk Shipping Market Overview & Outlook for April 2024, predicting that the supply/demand balance should strengthen in 2024, but weaken in 2025.
This would be the result of ships returning to the Red Sea and Panama Canal, shortening sailing distances.
Supply is forecast to grow 2.5% in 2024 and 2.0% in 2025. Growth is slowing due to lower deliveries, reports, Niels Rasmussen, BIMCO’s Chief Shipping Analyst.
The fleet is expected to grow 4.9% between end 2023 and end 2025, the slowest it has grown since 2016. Ship recycling is expected to stay low.
However, it may gradually increase from the start of 2025, due to a comparatively weaker market. Sailing speed could fall by 1.0% between 2024 and 2025. After a couple of years when speed fell significantly, it is now starting to stabilize at current levels. A reduction in congestion could lead to a 0.5% increase in supply in 2024. It has notably improved in Brazil due to smaller grain harvest, says Rasmussen.
Demand is forecast to grow 3.0% in 2024 and stabilize in 2025. Sailing distances have lengthened due to the rerouting away from the Red Sea and Panama Canal.
Iron ore shipments are estimated to grow 2.5% from 2023 to 2025. China may experience low domestic steel demand, but stronger demand abroad. Coal shipments are forecast to fall by 4.0% between 2023 and 2025. Fast growth in domestic mining in India and increased renewable electricity production could curb demand. Between 2023 and 2025, grain shipments are forecast to increase by 3.5%. Grain supply has stabilized since the start of the war in Ukraine.