The reefer sector is set for encouraging growth this year, thanks to healthy Southern Hemisphere crops, according to Drewry’s latest ‘Reefer Shipping Forecaster’.
This comes after what the consultancy has called “a tumultuous year in 2023”.
“Good growing seasons have supported improved deciduous exports so far this year, and South Africa’s citrus season is likely to deliver further growth, with new orchards coming into production, and good growing conditions expected to benefit orange, lemon and grapefruit exports.
“Similarly, in New Zealand, although a slow start for kiwis this year, it is expected to develop into a good crop later, with export volumes substantially up from last year’s disappointing performance. The major seaborne reefer commodity trade of meat and bananas also started the year with positive momentum, posting single-digit growth year-on-year (y-o-y).”
The healthy growth is predicted to continue for the rest of the year.
There’s also good news regarding freight rates as carriers continue to adjust prices down after pandemic-era disruptions.
And while the Middle Eastern conflict pushed up rates slightly in the first quarter, Drewry believes they will continue falling as excess capacity in the container segment compensates for any rerouting needed around the Red Sea.
The industry has managed to navigate Panama Canal-induced challenges well, with long-term deals signed by container shipping lines having secured priority for many shipments; the larger operators in particular have been able to obtain priority and maintain schedules.
Improved rainfall in the Central American state has helped bolster the outlook this quarter although water levels remain well below average historical levels, pointing to further impacts on schedules for some time.
Building on the momentum seen in the first few months of the year, Drewry expects improvements in exports and a continued decline in reefer freight rates to shape the outlook this year, with overall worldwide seaborne reefer volumes set to increase by more than 1% y-o-y in 2024.
