Fitch Ratings has upgraded its global shipping outlook to 'stable' from 'deteriorating' in 2025, driven by improved performance in tankers and bulk shipping despite a continued downturn in container shipping.
FITCH Ratings has upgraded its outlook for global shipping from 'deteriorating' to 'stable' in 2025, citing improved performance in tankers and bulk shipping despite a continued downturn in container shipping.Supply chain pressures and geopolitical risks remain key factors for the industry. 'We forecast tankers and dry bulk to remain stable, with the former most likely to perform well,' Fitch Ratings said.
'Container shipping is on track to reach an oversupply situation in 2025 with new vessel deliveries, likely further reducing freight rates.'Geopolitical conflicts drove elevated freight rates in 2024, benefiting tankers affected by the Ukraine war and container routes disrupted in the Red Sea. While reducing geopolitical tensions could normalize rates, Fitch noted that this process would take time. Trade policy changes following the US 2024 elections present additional risks. 'Re-routing trade lanes may mitigate demand risks,' Fitch observed.Shipping's exposure to emissions regulations poses medium- to long-term challenges. Higher compliance costs and infrastructure investments will be necessary to meet evolving standards. Fitch projects ship supply to grow by 5.8 percent in 2025, outpacing demand growth of 3.5 percent, which could further weaken the market in 2026.The Red Sea conflict has significantly increased re-routing around the Cape of Good Hope, adding 10-12 percent to sailing distances and ship demand. 'We expect average sailing speeds to decline in 225, as supply expands faster than demand,' Fitch predicted.The International Monetary Fund forecasts global economic growth of 3.2 percent in 2025, with faster-than-2024 growth in the EU and Japan. Despite uncertainties, Fitch's stable outlook reflects resilience in key shipping sub-sectors and the potential for gradual market adjustments
SHIPPING GLOBAL ECONOMY GEOPOLITICAL RISKS SUPPLY CHAIN EMISSIONS REGULATIONS
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