Trade activity lifts outlook in maritime sector
In the wake of increased trade activities and international summits that have bolstered regional economic cooperation, new data indicate that the fourth quarter should be a turning point for the recovery of China's shipping sector.
Due to weak demand, depressed freight rates and price wars, China's shipping industry has been stuck in a recession for more than four years.
But Han Yichao, an industrial analyst with Changjiang Securities Co, said new signs reflect a shipping recovery, as both emerging and developed economies are eager to adjust their policies to boost trade.
"Thanks to new measures to stimulate exports and promote trade - such as creating bilateral ties to a comprehensive strategic partnership and signing free trade agreements with countries such as Indonesia, Iceland and Switzerland - China's shipping market will continue to grow in the fourth quarter and beyond," Han said.
The Shanghai Containerized Freight Index, which measures outbound container rates, rose to one of its highest points of the year. The current cost of sending a container to Europe is about $765, which reflects a rise of about $45 since the start of 2013.
"With growth gaining impetus in the third quarter, regional trade among China, Europe, Southeast Asia and South America will be more dynamic," said Zhou Zhicheng, deputy director of the research department of the Beijing-based China Federation of Logistics and Purchasing.
Zhou said the ongoing rebound of the US manufacturing industry and real estate market is another factor that will fill vessels on shipping routes between the world's two largest economies.