Global Outlook

At the moment, the shipping lines move meat in either specialist reefer (refrigerated) vessels or in 'standard' container ships that carry self-maintained reefer containers alongside traditional non-refrigerated units. However, the containership operators are set to increase their reefer container capacity significantly over the coming years as they standardise their fleets and take market share from shipping lines running dedicated reefer vessels.

Shipping analysts have reported that the average age of specialised reefer ships is 22 years and that the size of the reefer fleet has fallen by 17% in less than 10 years. This contrasts with the container fleet, where the average is only 10 years and is likely to remain so, given the number of new-builds coming on-stream. In fact, the known order-book for new-build containerships is larger than the whole specialised reefer fleet!

In essence, more ships, more ports and more trade routes will mean more competition and should mean keener pricing.

This won't happen overnight and we now have the usual uncertainty and differing opinions. For instance, some shipping lines are supposedly preparing to slash Asia-Europe capacity to combat rate declines, following a disappointing peak season, with carriers even skipping or postponing services. While much of the capacity reduction is due to the holiday period, some of the sailing omissions appear to have been made at short notice in reaction to the drop in volumes and are aimed at stemming the drop in freight rates which might drop further as the winter slack sea approaches.

Rates leapt earlier in the year due to several, temporary factors, such as container shortages. But those issues have passed and it's expected that, in the short-term at least, container rates will continue to fall from their recent highs to more realistic levels.

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