MID-SHIP Petcoke Report – Feb 24, 2025

February 24, 2025

Market overview:  

The dry bulk market demonstrated robust performance in 2024, fueled by strong demand for major commodities such as iron ore and coal and in the minor bulk trade for bauxite. This period also saw significant disruptions, including vessel rerouting due to challenges in the Red Sea and Panama Canal. Limited new-build deliveries and modest recycling efforts helped keep fleet expansion in check, maintaining a balanced supply-demand dynamic that supported firm freight rates for most of the year. Normalizing the Panama Canal and reducing port congestion later in the year contributed to effective fleet growth, which softened rates in the latter half.

As we look ahead to 2025, the market landscape is expected to shift. Demand growth is anticipated to cool, with the potential resolution of the Red Sea conflict allowing ships to resume shorter routes, thereby reducing ton-miles and easing capacity pressures. Cargo volumes are projected to grow more modestly, and high inventory levels in China suggest a potential softening of import demand. However, the minor bulk sector, particularly bauxite and alumina, is expected to continue its growth trajectory. Fleet growth is estimated to remain steady, but weaker market conditions could lead to increased recycling of older vessels in 2025.

In summary, 2025 will likely see a softer dry bulk shipping market than 2024. While demand growth will persist, it is expected to slow, and supply will increase modestly. Freight rates are likely to be lower, especially if shipping routes normalize. Steady cargo volumes and constrained fleet growth should prevent a drastic downturn. This year will be an adjustment following 2024’s relative strength, with outcomes heavily influenced by ongoing global trade negotiations and geopolitical tensions.

The outlook for 2025 is cautious, with potential geopolitical developments and unexpected commodity surges acting as wild cards. Key factors to watch include developments in the Red Sea and China’s economic moves, which will play crucial roles in shaping the market dynamics.

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