Despite an oversupply of vessels in the dry bulk market, an equivalent of more than 1,300 capesizes capacity over the next 10 years are needed to meet an increase in cargoes, Moody's Investors Service predicted, Seatrade Asia online reports. Trade in dry bulk cargoes will increase 3% a year on average until 2021 to almost 4.7bn tonnes, an increase of 1.2bn tonnes, according to a report by the credit rating company. The amount of additional capacity needed to accommodate the gain equates to 1,111 to 1,311 capesizes.
Demand will come primarily from high meat consumption in emerging nations, spurring a need for grains used to feed cattle, and raw materials will travel over longer distances.
However the glut of ships will continue to keep freight rates “severely depressed” for the next 12 to 15 months, the report projected.
For this year, trade growth will slow to 4-5%, down from 6% in 2011, as the fleet expands by 8%, it forecast.
The demand and supply are imbalanced by 20% at present. The mismatch will persist until the end of 2013, according to Moody's.
Demand will come primarily from high meat consumption in emerging nations, spurring a need for grains used to feed cattle, and raw materials will travel over longer distances.
However the glut of ships will continue to keep freight rates “severely depressed” for the next 12 to 15 months, the report projected.
For this year, trade growth will slow to 4-5%, down from 6% in 2011, as the fleet expands by 8%, it forecast.
The demand and supply are imbalanced by 20% at present. The mismatch will persist until the end of 2013, according to Moody's.