Tanker shipping is likely to be more stable, benefitting from continued higher-than-average profitability supported by tonne-mile demand dynamics and the potential for oil inventory restocking due to lower oil prices, it noted.
Container shipping profits are set to decline significantly in this year from 2024 levels, which previously benefitted from Red Sea disruptions that increased freight rates.
Container volumes in 2025 could be flat or slightly decline compared with last year due to the impact of US tariffs; Fitch expected about 3-per cent growth in early 2025.
At the same time, global fleet capacity is likely to increase by about 6 per cent, meaning that even if trade tensions ease and demand subsequently increases, supply will still exceed demand, Fitch Ratings said in a release.
“We expect container freight rates to continue declining from the highs achieved in mid-2024. However, short-term changes in demand, such as the pull-forward of demand due to pending tariff increases and consequent supply-chain bottlenecks, such as port congestion, could temporarily support rates,” it noted.
Further risks to container freight rates include the normalisation of traffic through the Suez Canal, which could increase effective capacity by more than 10 per cent.
The US Trade Representative’s proposed port fees add further complexity, particularly for container shipping. The impact of the proposed scheme on container shippers will vary depending on whether they are Chinese-owned, the proportion of their revenue generated on routes to and from the United Statews and the proportion of Chinese-built ships in their fleet.
“We expect container shipping companies to adjust their networks to minimise the impact of this scheme,” Fitch noted.
The scheme, if implemented, may add $120 in fees per container for non-Chinese operators using Chinese-built ships from October 14, 2025 (increasing to $ per container by 2028). Chinese-owned and operated vessels will face additional fees.
The rating agency continues to see limited volume growth in dry bulk, where demand from China remains the primary driver.
“We expect global dry bulk volumes to remain about flat in 2025, while global shipping capacity will increase in low- to mid-single digits, leading to weak rates,” it said.
Tankers could continue performing well due to strong tonne-mile demand from west-to-east trades and lower oil prices, which could increase storage activity as global oil inventories are running at the low end of their historical range, it said.
The order book for tankers is broadly balanced by fleet age despite its increase in recent years, leading to limited net additions.
Key factors that may affect the sector include further macroeconomic deterioration and the normalisation of Red Sea transits. However, changes in regulatory regimes or sanctions may affect fleet capacity and could be positive for freight rates, Fitch ratings observed.
Moreover, there could be supply-chain bottlenecks due to changes to trade routes in response to tariffs or the US port fee scheme, which could support freight rates, particularly for container shipping, it added.
ALCHEMPro News Desk (DS)
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