Drewry expects MPV and heavy-lift growth to slow in second quarter

Drewry expects the growth of the multipurpose and heavy-lift sector to slow in the second quarter and third quarter. Conditions will remain favourable, but growth is not expected to be as strong as it was in the first quarter of this year, analyst Susan Oatway says. 

“While Drewry remains cautiously optimistic about the longer-term outlook for the sector, the continued uncertainty around global recovery coupled with the surety that the capacity issues will start to improve from 3Q21, means that the shorter-term outlook is weakening, albeit very slowly”, Oatway writes in Drewry’s latest charter rates analysis.

Drewry’s Multipurpose Time Charter Index tracks one-year period charter rates across a basket of vessel types and sizes including breakbulk and project carriers and forecasts the market movement over the coming month. The index increased to USD 7,795 per day in March, representing a rise of almost 15% compared to the previous month. Over the year to March 2021, Drewry’s index is up 24%. Drewry expects the index to rise a further 6.5% in April to reach $8,300 per day.

Rates for all sectors of the market rose significantly over March, as the multipurpose vessel (MPV) charter market benefitted from capacity constraints in both the container and bulk sectors. “With breakbulk demand firm and charter rates in the competing sectors at levels not seen for a number of years, shippers returned to the MPV sector for their transport requirements”, Oatway states.

Shipbroker Toepfer last week also reported a sharp incease in charter rates.