Despite many adversities for the maritime sector over the last year, seaborne perishable reefer trade increased in 2015 – and is forecast to grow further still in 2016.

By 2020, seaborne reefer cargo will reach 120 million tons—increasing by an average of 2.5 percent per year—according to the latest edition of the Reefer Shipping Market Review and Forecast 2016/17, published by global shipping consultancy Drewry.

While future seaborne cargo growth levels are lower than those of the last decade by 3.1 percent, such increases will have a direct effect on both container lines with reefer capacity and specialized reefer operators. With over 400 containerships with reefer capacity yet to be delivered, and possibly more still to be confirmed, Drewry looked at the effect this will have on capacity utilization. Based on the confirmed orderbook, reefer utilization will actually improve as a result of the increased seaborne cargo volumes and rising market share for the reefer containership mode.

On the other hand, with a reducing specialized reefer fleet, not only will this mode see its cargo volumes decrease, but also its market share will also reduce. Nevertheless, it currently provides around five percent of overall reefer capacity yet carries in excess of 23 percent of total seaborne perishable reefer cargo and is set to continue to punch above its weight.

Although seaborne pharmaceutical trade levels decreased year-on-year, it is clearly an exciting market with the potential of various commodities switching from airfreight to sea freight, if insurance issues can be resolved. The combined exports of sugar and chocolate confectioneries reported a strong growth in 2015.

“Drewry estimated that the container sector as a whole made $4 billion in profits over 2015, but as the year progressed momentum slowed as demand weakened,” said the report editor, Kevin Harding. “This in turn impacted freight rates in the specialized reefer sector as container lines chased every available dollar. As a result, reefer shipping has become increasingly unprofitable in 2016, along with dry cargo trades.”

One positive is that there is plenty of available containerized capacity and no shortage of equipment. The leading container carriers are also doing their best to invest in more technology to help shippers in terms of track and trace. But with freight rates at such low levels, their ability to keep investing is being challenged.

“The reefer sector is reporting continued cargo growth which is very encouraging for vessel operators,” said Harding. “Specialized operators have realized that to survive they have to develop and this report details the ways in which that is currently happening.”