Dry bulk trade growth: losing momentum?

After another solid performance in the past twelve months, commodity import demand could slacken in the year ahead, tentative signs suggest. World seaborne dry bulk trade growth in 2025 seems likely to decelerate as a consequence.

 

Prospects for economic activity affecting industrial output in countries importing related dry bulk commodities are positive but not especially bright. Global growth in gross domestic product during 2025 appears set to remain broadly similar to the 3.2% increase estimated for last year. Of particular significance is that China’s pace of advance is not expected to improve, while among other countries overall economic performance may remain muted.

 

Currently there are only limited indications of strengthening trends in the steel industry that could be enough to boost iron ore trade. According to a recent forecast by analysts at the Australian Government Department of Industry, crude steel production in Japan, South Korea and the European Union could increase by 1–2% in 2025 compared with last year’s level, but China’s total is expected to weaken slightly.

 

Provisional data published by the World Steel Association confirms that crude steel output in 2024 among raw materials importing countries displayed a mixed pattern. Expansion was visible in the EU and India, where volumes rose by 2.6% to 129.5mt (million tonnes), and 6.3% to 149.6mt respectively. Elsewhere reductions were prominent, including a 1.7% decrease in China, a 3.4% decline in Japan and a 4.7% fall in South Korea.

 

During 2024 world seaborne coal trade apparently increased again, by 3–4%, following a faster 7% expansion in the previous year. The strength of this upwards trend has exceeded many expectations, mainly as a result of much larger imports into China than generally predicted.

 

Over the past two years while China and India have boosted coal imports, several other major importers — Japan, South Korea and the EU plus United Kingdom — saw reductions. Growth in other countries was modest, but China’s massive upturn was enough to ensure that the overall global coal trade trend was very positive. Whether this pattern can be maintained in the year ahead is unclear, because some of the influences providing support may moderate or reverse.

 

Indications of changes in import demand among grain and soya importing countries point to a possible weakening. In the current 2024/25 trade year ending third quarter 2025, US Department of Agriculture data for world grain and soya trade suggests that the total could fall by 24.3mt or 3%, from 714.2mt in 2023/24, to 689.9mt.

 

Contributing to this estimated global outcome, a large reduction in China’s imports is expected to be prominent. Lower Chinese import demand for wheat, corn and barley after continued growth in domestic grain production is envisaged, while soyabeans purchases also could be lower. Wheat and coarse grains imports in 2024/25 are forecast by USDA at 41mt, a 21mt or 33% fall from the previous twelve months.

 

Steel products (coil, plate, sheet and other items) are a prominent part of the minor bulk commodities segment. Calculations for 2024 suggest that seaborne trade growth may have been similar to the previous year’s outcome, at more than 4%, raising the total volume to over 390mt. Some signs point to a further increase this year.

 

Additional new carrying capacity expanded the world fleet of bulk carriers in 2024, as shown by table 2. Bulk carrier newbuilding deliveries of all sizes totalled an estimated 34 million deadweight tonnes according to Clarksons Research data, a similar figure to that seen in the preceding year. Although scrapping diminished, fleet capacity grew by a steady 3%. In 2025 newbuilding deliveries may be somewhat higher, but scrapping may also rise.