Fitch Ratings’ sector outlook for global shipping remains negative as we do not expect a material improvement in market fundamentals in 2018 due to lingering overcapacity.
Both container and bulk show signs of a revival, but the longevity of this trend remains uncertain due to limited adherence to capacity discipline in the sector. Improving market sentiment and a focus on scale and vessel size have stimulated new orders. The supply and demand dynamics are likely to support container, bulk and LNG rates, but tanker rates could remain under pressure.
Container shipping freight rates have increased this year, but overcapacity makes this recovery fragile and previous rate increases have proved short-lived. Any improvement in market sentiment tends to stimulate new orders, and this happened again when new orders, including for mega-ships, surged in the third quarter of 2017.