Signs pointing to dry bulk trade growth are still prominent. Despite temporary adverse effects from recent events in Japan, global import demand for many commodities continues to increase. A positive outlook for a wide range of industries using imported raw materials and other products, in most countries, provides an encouraging foundation.
The IMF’s latest forecast of economic activity supports this view. High oil prices are not yet seen as an overwhelming threat. World GDP is expected to sustain solid expansion during 2011 at 4.4%, slightly less than last year’s 5.0% recovery rate, followed by a similar performance next year. However, Japan’s participation is especially difficult to assess.
 
COAL
Prospects for seaborne coal trade seem favourable, with imports into a number of Asian and other countries contributing to a sustained upwards trend. The latest estimate by Abares suggests that global steam coal trade (including land movements, but mainly seaborne) could increase by 21mt (million tonnes) or 2.7% in 2011, reaching 792mt. Other forecasters are more optimistic. Coking coal movements may be 10mt (4%) higher, at 264mt this year.
Among key steam coal importers, additional volumes into South Korea, Taiwan, Malaysia and, especially, India are envisaged (see table 1). Several European countries also may need extra supplies. But the outlook for China’s purchases is not so clear, and there is a possibility that the strong growth seen in the past two years will cease or partially reverse, perhaps temporarily. Another question is whether Japan’s steam coal imports of 108mt last year will be exceeded.
 
IRON ORE
Figures for blast furnace pig iron production in the 2011 first quarter indicate how iron ore usage and import demand is progressing. Positive performances were prominent. Among the main ore importing countries, China’s pig iron output has resumed expansion, totalling 157.4mt in the January-March period, after weakness in the previous six months.
In the European Union, production of pig iron during this
year’s first quarter was 24.3mt, similar to the average for the preceding three quarters. Japan’s output of 20.7mt was also close to levels seen in the previous three quarterly periods, despite an impact from the early March earthquake. By contrast, South Korea’s recent capacity enlargement resulted in a record high 10.2mt.
 
GRAIN
Although the outlook for grain import demand in the new 2011/12 crop year beginning July is still hazy, some elements are becoming more predictable. It seems quite possible that global wheat and coarse grains trade will continue to increase slowly. But unexpected weather developments could alter this view.
Assuming that there are no severe shortfalls in importing countries’ domestic harvests this year, potential for extra import purchases appears limited. The International Grains Council’s latest forecast for 2011/12 world trade in wheat and coarse grains suggests a rise of only 4mt (under 2%), from an estimated 243mt in the current year, to 247mt. Stronger demand for wheat may be partly offset by reduced corn shipments.
 
MINOR BULKS
Agricultural products and related commodities form a sizeable proportion of the minor bulks trade sector. The sub- group includes oilseeds and meal, rice, sugar and fertilizers, seaborne movements of which apparently totalled over 270mt last year.
Currently the outlook is for modest overall growth during 2011, although negative factors in the sugar and rice trades have emerged.
 
BULK CARRIER FLEET
Among expanding bulk carrier fleet segments, the capesize fleet is set to grow rapidly again during 2011, as shown by table 2. Newbuilding deliveries are expected to equal last year’s greatly increased 38m dwt volume, but scrapping could surge, possibly reaching or exceeding 8m dwt. Lower tanker conversions may assist in restraining deadweight capacity growth to about 15% this year.