Dry Bulk Shipping: A History of the Last Decade and Positive Predictions for The Year to Come
To begin, dry bulk shipping is the mass movement of unpacked major commodities such as iron ore, coal, and grain, along with other minor commodities such as steel or lumber. A fundamental industry that fuels global trade, according to an article from Maritime Info, “without the estimated 285m dwt of dry bulk shipping transported by sea annually, life today would be altered dramatically. Just having breakfast would be a very different event, with the ingredients of bread and cereal coming from dry bulks, as well as coffee and the sugar to sweeten it. Even the metal elements of your toaster and kettle come by sea and the coal to generate the electricity supply to power both appliances is likewise shipped in.”
With that, in the following paragraphs, we will look at the dry bulk industry over the last decade as well as positive predictions for the year to come.
A History of The Last Decade
Regardless of the importance of this industry, unfortunately, over the last decade, dry bulk shipping has seen hard times. Following fruitful years in the early 2000s, in 2009 and 2010, a large downturn in dry bulk shipping occurred. Directly linked to the aftermath of the 2008 global recession, most dry bulk companies hoped the industry would bounce back quickly. By 2011, a small upturn encouraged shippers, but the years to come would prove a rollercoaster that would end in hardship.
As mentioned in Hellenic Shipping News, “during the four years from 2011 to 2014, immediately after the exceptional changes occurring previously, rapid expansion of global seaborne dry bulk trade growth was seen, at rates close to 6% in each year, averaging 5.8%, based on Clarksons Research data. This vigorous enlargement was followed by much slower progress. In the next four years, from 2015 to 2018, growth varied widely between almost nil (0.2% in 2015) and a robust (4.1% in 2017), with an average 2.1% annual rate.” Sadly, by 2018 all the way through the end of 2019 and into 2020, rates dropped. Down 17% to 20% year-over-year, at the end of the decade, the sluggish growth felt almost impossible to overcome.
Fortunately, in recent months, following the global pandemic, dry bulk commodity prices are going up.
Positive Predictions For 2021
Recently, an article by Bloomberg Quint stated that “commodities haven’t been this sexy since the mid-2000s, when China was stockpiling everything from copper to cotton while crop failures and export bans around the world boosted food prices, eventually toppling governments during the Arab Spring. The backdrop is now starting to look similar, with a broad gauge of commodity prices hitting its highest in six years.”
As 2021 continues to show positive numbers for commodities, dry bulk shippers are excited to ramp up again. While not predicting a decade as positive as the 2010s, many experts have suggested a mid-range upturn with inflation in the material sectors.
Whether your cargo is on the water, on land or in the air, Clearfreight has the expertise and technology to help ensure your cargo gets to its destination safely and in a timely manner. Contact one of our freight experts today to learn how we can help support your supply chain and meet your customers’ demand.