Freight demand bounce back unlikely as lockdowns are eased
Summer peak season container shipping volumes are unlikely to reach the same levels as last year, with retailers and manufacturers erring on the side of caution as they assess the extent of pent-up consumer demand following lockdowns, according to Maritime Strategies International (MSI).
In its latest market report, the analyst reiterates its view that any volume recovery in the second half of 2020 will be patchy.
“While there may be an initial uplift in volumes to meet immediate demand as economies begin to open, there is growing anecdotal evidence that peak season volumes will be lower on a year-on-year basis, and potentially quite sharply so,” said MSI.
MSI expects importers in consumer-facing industries to display caution when placing orders for later in the year. “There is still substantial uncertainty over the extent to which societies and economies will have returned to anything approaching 'normal' by Q4 20, and so conservative planning when managing inventory is likely to be the course followed by many,” said MSI.
“We certainly expect a sequential improvement in volumes relative to Q2 20, but remain concerned over the likelihood that 'temporary' joblessness will become longer-term, corporate defaults will increase and wage growth will slow.”
MSI expects aggregate main lane headhaul growth of around -15% year-on-year in the three months to July, with the earlier part of that three month period bearing the brunt of the volume downturn.
“In the three months to October we expect volume growth of around -3% year-on-year, with risks lying both to the upside and to the (more likely) downside,” it added.