Red Sea attacks to impact ship sailing speed: BIMCO

LONDON : BALTIC and International Maritime Council’s (BIMCO) latest report on the container shipping market highlights significant trends amid ongoing challenges due to the Red Sea attacks.

Ship supply is set to grow by 9.1 percent in 2024 and 4.1 percent in 2025, with a notable surge in demand attributed to the recent Red Sea attacks.

The rerouting of vessels via the Cape of Good Hope is expected to affect shipping routes until mid-2024. This adjustment, coupled with the heightened demand, forecasts a 9.5 percent increase in demand this year, followed by a slight decline of 0.5 percent in 2025.

While the global economy is projected to pick up pace in 2024 and 2025, major economies like the US, China, Japan and India may experience slower growth rates. Despite this, retail sales in the US and the EU remain steady, though concerns linger about the sustainability of consumer spending post-pandemic.

Ship deliveries are poised to set a new record in 2024, beating the record set in 2023. The fleet is expected to grow 14.9 percent between the end of 2023 and the end of 2025.

However, challenges persist; notably, recycling is expected to remain low in 2024 due to increased demand triggered by the Red Sea incidents.

Though local strikes and potential disruptions pose risks, global congestion levels remain manageable. The need for adaptable responses to evolving threats underscores the industry’s resilience in navigating complex geopolitical and economic landscapes.

The long sailing distances around the Cape of Good Hope have led to a slight increase in sailing speeds.

“We expect average sailing speed to remain stable in 2024 but fall in 2025,” Bimco said.

Attacks on ships in the Red Sea have forced nearly all container ships to sail around the Cape of Good Hope, adding 10 percent to average sailing distances and ship demand.