Fitch Ratings downgraded its 2025 outlook for the global shipping sector to 'deteriorating' from 'neutral', citing falling demand in container and dry bulk shipping. The container segment faces a sharp drop in profits from 2024 levels, which had been temporarily lifted by Red Sea disruptions. Fitch expects container volumes to stagnate or slightly contract amid US tariffs, while global fleet capacity is projected to expand by 6 per cent—keeping supply ahead of demand even if trade tensions ease. Freight rates are set to continue declining, though temporary surges could arise from tariff-driven demand shifts or port congestion. Risks include a potential normalisation of traffic through the Suez Canal, which could expand effective capacity by over 10 per cent, and the proposed US port fee scheme targeting Chinese-owned or Chinese-built vessels. If enacted, the fees could reach $120 per container in 2025 and rise to $250 by 2028. Dry bulk shipping is also expected to see flat volumes, weighed down by slowing Chinese demand. Global capacity growth in the low- to mid-single digits will likely keep rates subdued. Fitch forecasts Chinese GDP to fall below 4 per cent in 2025–2026, with global GDP growth slipping to 1.9 per cent in 2025 from 2.9 per cent in 2024. Tanker shipping remains the sector's most stable segment, supported by strong tonne-mile demand and the potential for oil inventory restocking amid lower prices. Attribution: Amwal Al Ghad English Subediting: M. S. Salama
