Reefer Shipping Continues to Thrive

Despite reports stating that the specialist reefer industry continues to lose market share to the reefer container operators, cargo volumes are increasing overall and as a result the specialist reefer carriers are not suffering a reduction in cargo volume. Drewry Shipping Consultants Ltd., leading maritime consultants, has released its latest Reefer report “Annual Reefer Shipping Market Review and Forecast 2007/08”. The report outlines how world reefer trade has grown from 84.6 million tonnes in 1995 to 132.7 million tonnes in 2005, a compound annual growth (CAGR) of 4.6 per cent. Based on current economic forecasts, reefer trade should show strong growth with world trade in perishables set to increase to 199.5 million tonnes in 2015. Seaborne reefer trade is also forecast to grow significantly – from 73.0 million tonnes in 2006 to 104.6 million tonnes in 2015 – a CAGR of 4.1%. The specialized reefer fleet above 100,000 cubic feet has declined in number from 878 vessels in 1999 to just 786 vessels in 2007. Conversely, the container fleet has increased significantly to a total of over 4,000 vessels as at quarter 1, 2007 with a further 1,265 on order at that time. Container capacity is predicted to increase by almost 50 per cent between 2007 and 2010. While the existing container fleet provides 1.25 million TEUs of reefer capacity, offering approximately 1,250 million cubic feet of reefer capacity, the specialized reefer fleet above 100,000 cubic feet provides 321 million cubic feet of capacity – little more than 20 per cent of overall reefer capacity. Drewry reports that this dramatic change is driven partially by the demand from receivers of cargo, but also questions the extent to which this is being forced by the lack of investment in specialized reefer tonnage Cargo volumes are forecast to continue to increase and while individual trades may be lost from specialized reefer tonnage to reefer container tonnage, the global volume of reefer cargo carried by the specialized reefer vessels may be far less affected. The overall message is that the specialized reefer industry is likely to continue to lose market share but, for those who remain, a healthy future – and least for now – is likely.