Buoyant trade is on the horizon

One for our younger readers: remember the 2000s? It was a decade that saw the creation and explosion of reality television, the Internet take over the world and China’s development lift trade growth to unprecedented highs.

That fuelled arguably the greatest boom shipping has ever experienced.

But since the global financial crisis at the end of the decade, trade growth has been patchy, an issue that goes to the root of today’s strained shipping markets.

Figures released this week reveal what shipping markets have already felt. Global merchandise trade is growing at its fastest rate since August 2010, according to the Dutch government’s influential CPB Netherlands Bureau for Economic Policy Analysis.

In the three months to January, global trade in goods was up 2.4% in volume terms when the effect of dollar price changes are stripped out, with emerging markets leading the way with exports up 4.2%.

Key emerging markets appear to have seen a pick-up in both commodities and manufacturing exports, which analysts interpret as a positive sign. The CPB believes annual global trade growth may hit 3% this year and 4% in 2018.

It is more evidence to support a thesis that shipping will see demand rising over the next few years, giving the prospect of stronger freight rates. All that is needed now is for the newbuilding market to remain subdued.