Container shipping is losing market share to dry bulk. Image Credit: File Image / Pixabay
Disruption in supply chains as a result of the COVID-19 virus outbreak is causing dry cargo exporters to switch from containerised frieght to dry bulk ships, according to price reporting agency S&P Global Platts.
The virus outbreak has reportedly left parts of the world short of containers, causing a rise in boxship freight rates.
"There are fewer boxes to go back so we are seeing a spike in freight rates at this point, the backhauls are essentially becoming the fronthauls," Platts cited an unnamed freght forwarder as saying Wednesday.
In some markets this has led exporters to turn to dry bulk shipping, where freight rates have remained depressed, as a result, the agency said.
The shipping industry was looking forward to a stronger dry bulk market this year with improving trade relations between the US and China, but the virus outbreak has seen rates drop to multi-year lows.