The reefer freight markets received a boost this year as container liner services got pruned back. Philip Gray, Reefer Shipping[ds_preview] Analyst with Drewry and editor of its annual review of the sector, considers the fundamentals to be healthy over the coming years. Specialist reefer operators are likely to continue losing market share versus container carriers though.
Both specialist reefer t/c rates and reefer container rates went up this year amid the Covid-19 crisis. Why does the sector seem to be doing well despite a global recession?
Philip Gray: The food and particularly the perishables cargo segments have traditionally performed well compared to the dry cargo trades. We also saw it in the aftermath of the 2008 crisis where the dry cargo and the container sectors had some difficult years whereas the reefer trades weathered the crisis reasonably well. People always seek healthy food while reefer equipment and capacity are not in overabundance.
How do you see supply/demand in the reefer trades developing over the coming years?
Gray: As far as reefer container equipment is concerned, we forecast supply to slightly lag transport demand in our projections until 2024.
What’s the future of specialist reefer operators? Will there be enough seasonal business left for them?
Gray: The biggest issue for large specialised reefer vessels is the supply chain in the fruit and fresh food business with its growing reliance on reefer containers. Today there is still plenty of seasonal business available for the big ships (over 400,000 cft) although not always enough in-between seasons. They will maintain a role in supporting the reefer trades although container liner operators will continue nibbling at the edges. Whether reefer operators themselves convert to fully containerised services one day, remains to be seen. The big banana multinationals have already converted to a large extent to container vessels in a mix of dedicated (own) space and third-party liner services.
