Reefer container equipment availability will remain tight over the next few years which will impact shipping capacity supply and freight rates at seasonal peaks, shipping consultancy Drewry said.
After the dramatic halt in reefer equipment expenditure by cash-strapped shipping lines in 2016 which led to acute shortages in several regions, production of new refrigerated container equipment recovered during 2017 and continued to gather pace in 2018.
Drewry expects the reefer container equipment fleet to maintain a CAGR of 4.5% over the next five years which is slightly ahead of anticipated growth in containerised cargo traffic but will not be sufficient to bring supply back into equilibrium.
By contrast, there remains ample supply of containership reefer slot capacity on most trades, though certain routes with a high proportion of reefer cargo can experience tight space during seasonal peaks.
“While we expect container carriers to continue to improve the effective availability of reefer containers through more centralised inventory and imbalance management, Drewry’s data indicates that equipment supply conditions will remain tight,” Martin Dixon, Drewry’s director of research products, said.
“With cargo owners increasingly reliant on container carriers to move perishable products, given the ongoing decline in the specialised breakbulk reefer shipping fleet, refrigerated shipping capacity could be constrained during seasonal peaks.”
Global seaborne reefer trade continued to grow in 2018 but the pace of expansion was slower than trend and is projected to be more muted over the coming years, according to Drewry. The shipping consultancy estimates that the volume of seaborne reefer cargo grew 3% in 2018 to 129 million tonnes which was weaker than the 4.4% gain achieved in 2017 and the 3.5% average annual rate recorded over the prior 10-year period.
Looking ahead, the worldwide seaborne perishable reefer trade is forecast to continue to expand but at a below trend rate of 2.7% a year in the period to 2023 as certain seasonal climate related factors such as El Nino slow production output in the short term and rising geopolitical risk impacts wider trade growth prospects.