In a new report published Tuesday, analysts with maritime consultancy Drewry said that the reefer trade has lost profitability along with other shipping sectors, but it is set to grow to 120 million tonnes per annum by 2020, a rate of annual increase of 2.5 percent per year – raising the potential for better times to come.
This year's freight rates have not been good for vessel operators, though, says report editor Kevin Harding. "Drewry estimates that the container sector as a whole made $4 billion in profits over 2015, but as the year progressed momentum slowed as demand weakened. This in turn impacted freight rates in the specialised reefer sector as container lines chased every available dollar. As a result, reefer shipping has become increasingly unprofitable in 2016, along with dry cargo trades," he said.
The predicted growth trend through 2020 is less pronounced than it has been in past years, Drewry said, but still strong enough to potentially have a positive effect on container lines like CMA CGM, which recently announced a new strategic emphasis on the reefer trade in order to boost revenue per TEU.
Drewry foresees the growth in the perishable cargo business going primarily to container lines with reefer capacity, not to specialized reefer vessels. More than 400 containerships with reefer plugs are set to be delivered, perhaps more, Drewry says – but the number of specialized refrigerated vessels is in decline and the remaining ships are expected to lose market share.
"The reefer sector is reporting continued cargo growth which is very encouraging for vessel operators. Specialised operators have realised that to survive they have to develop and this report details the ways in which that is currently happening," Harding said.
For shippers, one positive is that there is plenty of available containerized reefer capacity on the market. The leading container carriers are also doing their best to purchase the technology to help shippers in terms of track and trace, Drewry says – at least to the extent that they are able to make new investments in an environment of persistent low rates.