How covid-19 put wind in shipping companies’ sails

SICKNESS AND shipping have a long shared history. The word quarantine is derived from the 14th-century Venetian practice of isolating ships at anchor for 40 days if plague was suspected on board. The latest ailment is a global pandemic that has killed at least 1m people and put the world economy, and global commerce, full steam reverse. This might have been expected to becalm an industry which carries 90% of traded goods—11.9bn tonnes last year, or 1.6 tonnes for every human—and where profits have often been elusive. The last time trade volume declined, in the aftermath of the financial crisis of 2007-09, maritime shipping suffered. Clarksons, a shipbroker, expects volumes to fall by 4.4% in 2020.

Still, Neptune seems to have smiled on shipping companies. Oil tankers and dry-bulk vessels that transport iron ore, coal and grain will turn a profit in 2020. Operators of ships ferrying containers, packed with consumer goods or components, are set fair for a banner year. Shipping is a business where, in the words of Martin Stopford of Clarksons, firms “make a living and occasionally make a killing”. This year, it appears, belongs to the second category. What is going on?

One answer is that the carnage wrought by the coronavirus has not been as bad as anticipated. The World Trade Organisation initially expected trade volume...

via Business Feeds

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