The US-China Phase One agreement is not likely to buoy the weak outlook for the container shipping market according to a recent Drewry forecast.
World container port output is projected to increase by 3.3pc in 2020, after increasing by approximately 2.3pc last year. The 2020 forecast includes a 0.7pc decrease from Drewry’s previous outlook at the end of September 2019.
The end of the US-China trade dispute will lift the global economy, but the forecast noted that more is required to safeguard a lasting trade arrangement between the two nations because their stark differences risk entangling them in future conflicts.
US duties on European imports may lead to more protectionist policies on the container market, the forecast said, presenting yet another risk to the containerized transportation industry.
Growth in demand, overcapacity, and rates are projected to rise in 2020 compared to 2019, but annual carrier profits are projected to decrease modestly. Carriers are advised to prepare contingency plans until trade flows are secured.