Clarksons Research have today released their mid-year review of shipping markets. With shipping often at the “frontline” of uncertain geo-political dynamics, understanding underlying market trends has often been “tricky”. Our cross-market day rate tracker the ClarkSea Index softened “only” 5% y-o-y in 1H to $24,101/day, but, container aside (+79% y-o-y), tankers (-33%), bulkers (-31%) and LPG (-22%) all eased back. Summarising the mid-year trends, Steve Gordon, Global Head of Clarksons Research, commented:
A half year of building complexities, with shipping often at the “frontline” of uncertain geo-political dynamics
Our cross-market charter rate ClarkSea Index softened “only” 5% y-o-y in 1H but excluding container markets the index is down 31% y-o-y
Global seaborne trade volumes stable at 12.6n tonnes per year but growth varied across segments as underlying Chinese economic trends introduce weakness and US tariff policy increased complexity
Asset markets market activity has also slowed, with newbuild order volumes down 54% (in the context of a very active 2024) and S&P volumes more resilient (down 16% y-o-y)
Global shipbuilding output stable year on year (China 48%, Korea 31%, Japan 13%) while new orders for China dropped (52% share vs 70% in 2024)
Fleet supply growth remains below trend overall, demolition expected to increase going forward and ageing demographics supportive of fleet renewal
‘Green Transition’ consensus weakened but remains a key underlying trend and economic opportunity, energy transition and energy security remain trends supporting gas and offshore
Segment Review… strength in containers but easing conditions y-o-y in other key segments after a strong 1H 2024
• Tankers: Average tanker earnings were steady vs 2H 2024 at $29,692/day in 1H, still 23% above the ten-year trend, with continuing underlying support from limited fleet growth and longer-haul Russian/European trade flows. However, earnings were down 33% compared to the very strong 1H 2024 (when product tanker earnings were especially strong after the start of Red Sea re-routing). VLCC earnings briefly rose to a 2-year high of ~$70,000/day in June amid the Israel-Iran conflict, before later ‘normalizing’ as tensions eased. OPEC+ cut unwinding offers some upside for 2H.
• Chemicals: Our chemical tanker TC rate index eased by 9% y-o-y in 1H, with impacts from softer CPP markets and ‘drag’ on volume growth from easing Chinese import demand.
• LPG: VLGC rates were softer across 1H (spot rates on the MEG-Japan route were down 22% y-o-y at $38,902/day) with increased Panama transits compared to early 2024, and with US export growth limited by capacity constraints. Elevated US-China tariffs generated some market volatility but US-China trade (13% of global LPG trade) has largely continued. In the ethane sector, there was disruption to US exports to China (half of global volumes) in June though recent US-China negotiations may signal some relaxation of curbs. VLGCs finished the mid-year strongly.
• LNG: LNG rates were weak, with spot rates for a 174k unit averaging $24,606/day, down 56% y-o-y, with pressure having built from strong deliveries and delays to project start-ups, compounded by a pull-back in long-haul trade as more US LNG has been shipped to Europe (rather than Asia). Long term trade growth outlook remains robust, steam turbines are 25% of the fleet, orderbook is 44% of fleet.
• Offshore: Offshore rates are down from their peak (still 60% above trend) with greater regional variations (Brazil remains strong). However, most segments show divergence between softer demand/lower rates for 2025 requirements, and firmer owner/charterer sentiment for 2026, as seen in firm recent fixtures (e.g for floating rigs) for 2H 2026 commencement. Offshore wind day rates generally strong.
• Bulkcarriers: Bulkcarrier earnings were down 31% y-o-y in 1H at $10,897/day (the first half of 2024 was strong). Earnings were also down 18% on the 10 year trend, against a backdrop of weaker demand, especially from China amid softer raw material demand fundamentals and elevated stockpiles. Firm growth in bauxite exports from Guinea (and regional congestion, contributing to the Capesize Q2 rally) remained a bright spot.
• Containers: The container market “brushed off” tariff fears (for the moment) and fleet growth to maintain last year’s charter rate gains, with rates in 1H up 80% y-o-y (and 80% above the 10 year trend, with continuing Red Sea re-routing key). Container freight rates were also above trend on average through 1H though there has been notable volatility, especially on the Transpacific, as US-China trade dynamics have evolved.
• Car Carriers: As anticipated, car carrier charter rates continued to correct as fleet growth has accelerated and demand growth has ‘cooled’, though remain above trend for now; the 1 year TC rate for a 6,500 ceu vessel averaged $55,000/day in 1H, down 50% y-o-y from the record levels seen across 2024, but still 32% above the 10 year average.
Fleet trends evolving… uneven fleet growth, newbuild order volumes easing, deliveries edging higher and limited recycling continuing
• The world fleet is still growing moderately, at ~3.5% y-o-y, but unevenly (gas, container, PCC have large orderbooks, crude tankers low).
• Newbuild ordering fell 54% y-o-y (in the context of a very active 2024, with market and geo-political uncertainty pausing some investment decisions e.g. USTR, Ships Act). Container ordering (1.9m teu) remained active (also cruise, ferry), gas and tanker investment slowed. New orders for China dropped, with Chinese yards taking 52% of contracts (in CGT terms) in 1H, vs 70% in 2024.
• Yard output was stable (with China accounting for 48% of the global total, Korea 31%, Japan 13%), yard forward cover remains strong, geo-political uncertainty impacting some ordering and potential geography (NB: shipbuilding is a long cycle business and capacity increases are evolving differently from the 2000s). Newbuild prices fell 1% across 1H, though our index remains 29% above the 10 year average. Long term fleet renewal, decarbonization investments and financing requirements (we value the world fleet and orderbook at $2.1 trillion) remain strong.
• Demolition has remained very low (5m dwt, 59% below trend), providing a potential market “release valve”. Sanction regime increased further, leaving a significant and ageing parallel / dark fleet.
• S&P activity eased ($19bn, >56m dwt, -15% y-o-y) with softer pricing for older tankers and bulkers but steady or firming prices for modern tonnage. Containership pricing has firmed.
“Green Transition” still a key underlying trend, key emissions regulation developments in 1H 2025…
• Although the “Green Transition” has moved down the strategic agenda, it remains a key underlying trend (as does fleet renewal) and economic opportunity: 55% of orders in 1H (by GT) were alternative fuel capable (LNG dominated). Adoption of Energy Saving Technologies continues, with >12,400 ships accounting for over 42% of fleet tonnage now fitted with at least one significant EST.
• EU regulations on marine fuel intensity (FuelEU Maritime) came into force at the start of 2025, with standards set to tighten over time.
• At the IMO, agreement was reached on the “Mid-Term Measures” – combined economic and technical measures to drive the next phase of shipping’s emissions reduction.
Source: Clarkson Research