{"id":75814,"date":"2023-12-27T00:00:00","date_gmt":"2023-12-27T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/logistics\/2023\/12\/27\/maritime-trade-volumes-set-to-recover-in-2023-unctad-says\/"},"modified":"2023-12-27T00:00:00","modified_gmt":"2023-12-27T00:00:00","slug":"maritime-trade-volumes-set-to-recover-in-2023-unctad-says","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/logistics\/2023\/12\/27\/maritime-trade-volumes-set-to-recover-in-2023-unctad-says\/","title":{"rendered":"Maritime trade volumes set to recover in 2023, UNCTAD says"},"content":{"rendered":"

Maritime trade expected to see moderate recovery in 2023: <\/strong>Maritime trade volume is expected to grow 2.4% in 2023, after inching down 0.4% in 2022, according to the United Nations Conference on Trade and Development (UNCTAD) Review of Maritime Transport (pdf)<\/a>. UNCTAD also predicts persistent but moderate growth in maritime trade until 2028, highlighting the sector\u2019s resilience.<\/p>\n

Containerized trade bounced back this year: <\/strong>Containerized trade, measured in metric tons, saw a 3.7% drop in 2022 but is expected to increase by 1.2% during 2023, before ramping up to 3% growth between 2024 and 2028. This does however fall short of the 7% long-term growth observed over the previous three decades. <\/p>\n

But it\u2019s not all smooth sailing:<\/strong> Heightened trade policies, geopolitical tensions, and changes in globalization patterns continue to weigh on maritime trade. On the supply side, container shipping must also contend with overcapacity, requiring carriers to manage capacity via idling, demolitions, and other means. Requirements for the industry to decarbonize and meet regulatory requirements while maintaining growth represents the most serious challenge for the sector going forward, UNCTAD says.<\/p>\n

Dry bulk and tanker shipments in 2023 continue to be severely impacted by the war in <\/strong>Ukraine: <\/strong>Oil cargo distances hit a long-term high in 2023, as Europe looked to alternatives for Russian energy and Russia rerouted its shipments to markets further afield. Grain shipments traveled further in 2023 than any year on record, despite a brief respite due to the Black Sea grain initiative. Many grain importing countries have had to look to other suppliers, such as the US or Brazil, thereby lengthening haul distances.<\/p>\n

REMEMBER-<\/strong>Russia backed out<\/a> of the UN-brokered Black Sea grain initiative mid-year, further hampering Ukraine\u2019s ability to supply global markets with grain. <\/p>\n

Growing intra-Asian trade is holding back global containerized trade distances:<\/strong>Containerized trade distances have been falling since 2020 but saw a slight uptick in 2023. This can be attributed to a rise in intra-Asian trade, which is carried over shorter haul distances, and has seen a boost in recent years as China continues to lead as a global manufacturing hub. <\/p>\n

Regional ports saw better connectivity in 4Q 2023: <\/strong>Saudi Arabia saw its largest-ever leap in UNCTAD\u2019s Liner Shipping Connectivity Index (LSCI)<\/a> for the quarter, jumping 10.8% y-o-y to 79.01 points. Egypt\u2019s connectivity improved 9.4% y-o-y to 74.91 and Qatar saw a moderate 3.5% y-o-y uptick to 41.05. The UAE continues to lead the region in terms of connectivity, with its associated LSCI hitting 80.71, 6.25% higher than the same period last year. Outside of the region, China continues to lead the index globally at 180.36, followed by South Korea (118.83) and Singapore (115.89). The year saw most regions recover in terms of pre-pandemic connectivity.<\/p>\n

Global merchant fleets are aging, despite an increase in newbuilds:<\/strong> 2022 saw global cargo capacity grow at an annual rate of 3.2%, hitting 2.27 bn dead weight tons (dwt). Container fleet capacity grew 3.9% during the period, while oil tanker fleets grew by 3.4% and bulk carriers by 2.8%. Despite the uptick in shipbuilding and deliveries \u2014 predominantly in China, South Korea, and Japan \u2014 commercial ships had an average age of 22.2 years at the start of 2023, 2 years older than the average a decade ago.<\/p>\n

Dry bulk freight rates have been particularly volatile:<\/strong> Shifting demand, congestion at ports, geopolitical troubles, erratic weather, and economic challenges yielded high volatility in dry bulk freight markets in 2022 and 2023. The Baltic Dry Index \u2014 a global benchmark for dry bulk rates \u2014 peaked in May 2022 before dropping to pre-pandemic levels by the close of the year and continuing to decline into early 2023. A surge in demand \u2014 led by post-pandemic industrial growth in China \u2014 saw the index rebound in 2Q 2023.<\/p>\n

Ship turnaround times have improved, but digitization and better regulation are key to <\/strong>further gains: <\/strong>Ship turnaround times improved in most regions in the second half of 2022 as pandemic-related disruptions became less impactful. South Korea leads globally in terms of ship turnaround times due to high levels of automation at its ports. Increased digitization and technology, and \u201cwell-oiled\u201d regulatory procedures are vital to realizing gains in port efficiency, the report says.<\/p>\n

Seaborne trade is taking steps to determine how to decarbonize:<\/strong> International shipping contributes some 3% of global greenhouse gas (GHG) emissions, making efforts to decarbonize the sector a priority for policymakers. A key milestone was achieved mid-year<\/a> when the International Maritime Organization\u2019s (IMO)<\/a> Marine Environment Protection Committee adopted a revised GHG reduction strategy that represents the clearest roadmap to date. <\/p>\n

But the international shipping industry faces some tough choices either way:<\/strong> Meeting the targets outlined in the IMO\u2019s new GHG reduction strategy entails high costs for industry players as they determine the best way to transition to low emission fuels. In particular, carriers and shipowners need to modernize their fleets to run on low carbon fuels whilst still being uncertain as to which alternative fuel represents the best pathway. What\u2019s worse is that ships have long lifespans, meaning that many vessels in the global merchant fleet will be too old to retrofit with new engines but too fresh to scrap. <\/p>\n","protected":false},"excerpt":{"rendered":"

The sector still needs to meet decarbonization targets, and handle challenges like rising geopolitical tensions and heightened trade policies<\/p>\n","protected":false},"author":1,"featured_media":75815,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[255],"tags":[184,123,254,32],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-75814","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-macro-picture","tag-decarbonization","tag-shipping-maritime","tag-the-macro-picture","tag-trade","wpautop","entry"],"acf":{"mongo_id":"bd8f1b8b-d98f-4c5b-a3df-10ddb1425304","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2023\/12\/1012.jpg","photo_position":"above","homepage_title":"","full_issue_title":"Maritime trade volumes set to recover in 2023, UNCTAD says","related_issue":[75804],"teaser":"The sector still needs to meet decarbonization targets, and handle challenges like rising geopolitical tensions and heightened trade policies","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2023\/12\/.60eb14e6-e141-43e0-81b5-4ac59f5203ac.mp3"},"yoast_head":"\nMaritime trade volumes set to recover in 2023, UNCTAD says - 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