by Richard Scott, Bulk Shipping Analysis 

Although signs of growth in many commodity imports into numerous countries remain prominent, offsetting influences are evident also. China is still seen as a key contributor to global seaborne dry bulk trade expansion. However, one of the main elements of Chinese purchases, coal, is showing a distinct tendency to weaken further, after declining sharply already.

A slightly more upbeat assessment of global economic prospects was published last month by the International Monetary Fund. Aided by lower oil prices and favourable exchange-rate changes, world economic output growth is expected to strengthen in 2015 and through next year, despite a continued slowing in China. Some benefits for dry bulk trade from this trend can be envisaged.


Prospects for coal trade growth have become more muted. A recent forecast by the Australian Government Department of Industry suggests that world steam coal trade (including land movements but mainly seaborne) could increase by 19mt (million tonnes) or under 2% in 2015, to 1,077mt. Coking coal trade may be 7mt (just over 2%) higher this year, at 316mt.

Estimates of steam coal imports into several Asian countries are shown in table 1. While India’s volume seems set to rise strongly again, China’s requirements could continue falling. India’s economy is performing briskly, power demand is rising and coal, which cannot be adequately supplied by the domestic mining industry, is the principal fuel being used for additional electricity output.


Demand for steel in the principal producing countries which import iron ore are not especially bright, according to World Steel Association estimates published last month. Global demand for finished steel products is forecast to grow only marginally again, by just 0.5% in 2015, after a similar small 0.6% rise in the previous twelve months.

However, in some countries negative changes are likely. China’s steel demand could see a 0.5% reduction in each of the next two years, while Japan may experience a 2.4%

decline this year before a pick up follows next year. By contrast, in the European Union, amid a modest economic revival, steel demand could grow by 2–3% annually in both 2015 and 2016.


Global grain trade over the past twelve months has evolved much more solidly than foreseen. After the rapid expansion seen in crop year 2013/14 ending June 2014, a sizeable reduction was expected. But estimates have been progressively revised upwards, and a small increase now seems predictable.

One of the principal reasons is changed expectations for China’s purchases. Following a strong surge in wheat and coarse grains imports into China during 2013/14, doubling the annual volume to over 19mt, a sharp reduction seemed likely. However, despite another good harvest last summer, domestic grain supplies in some areas appear to be tightening, and consequently imports could remain around the previous high level.


Within the minor bulks trade sector, agricultural and related cargoes comprise probably around one quarter of the total. Sugar, oilseed meals and fertilizers are key components. Although there are no signs of especially rapid expansion currently, positive influences are visible in some trades such as soyameal and other oilseeds and meals.


Much attention has been focused on the Capesize segment of the bulk carrier fleet recently, as a result of the heavy scrapping which has resulted from very depressed freight rates.

Sales of these ships for demolition in this year’s first quarter reached 5m deadweight tonnes, surpassing last year’s annual 4m dwt total. As shown by table 2, tentative estimates point to slightly higher Capesize newbuilding deliveries in 2015 as a whole, but a larger offset from greatly increased scrapping could reduce this fleet’s growth rate to around 3%.