Most owners and operators in bulk, breakbulk and multipurpose trades will be glad to see the back of 2009, and 2010 promises to be much improved, and yet filled with certain continuing challenges.
The dry bulk cargo market in the U.S. Gulf region surprised most with a quick rebound in the first quarter of 2009 following the steep decline in the second half 2008. And it seems rates and cargo volumes in the Gulf will remain buoyant at least through the first quarter of 2010.
Conversely, dry bulk cargo volume on our return leg from Southern Africa has been the worst in recent memory once the brakes were applied to raw material imports by the U.S. steel industry. Although the cargo volumes have picked up to modest levels, the weak U.S. dollar and lack of domestic demand does not bode well for U.S. imports of steel related products and raw materials in 2010.
The outlook for project cargo and mining machinery exports from the U.S. seems to be equally bleak despite the weak dollar. Breakbulk/multipurpose carriers like us serving emerging markets will have to rely on used equipment to fill space left by the drop off of mining machinery and project cargo.
This will be an exciting year for South Africa, which will be showcasing soccer’s World Cup. The construction involved is almost complete and has supported the domestic economy through this difficult year. However, the strong local currency, combined with the disruption to local industry, will make it a difficult year for South African exporters.
Difficult economic times provide conservative companies with opportunities to grow at the expense of those who over extended themselves at the height of the market. From an African perspective, 2010 may be remembered by the “survival of the fittest.”