Its Over

The German export machine has recovered and the authorities suggest that German gross domestics product in Q3 will be positive. A similar situation is noticeable in the UK.

With the resumption of production and output it can be expected that unemployment will be near a peak, so for those with jobs there is a level of confidence and security which will translate into increased consumption. Again, according to the ELAA, imports from the Far East are up 7% in Q2 vs Q1 of this year.

Industrial output in Asia is rising in response to European and American firms needing to re-stock in the face of depleted inventories. Housing statistics continue to rise in the US, another leading indicator of growth in imports.

Add to that the improvements in consumer confidence in the US and the stabilisation of the banking sector and we have signs that the green shoots of recovery have taken root.

Yes, there are pessimists. Have we not discussed the peculiarity of the maritime industry to be myopic? Comparing growth rates from the peak in global trade in mid 2008 with the trough in mid 2009 can certainly lead to pessimism, but that comparison is misleading.

I will stick my neck out and suggest that global trade will grow by 2% in the 2^nd half of this year and 6%-8% next year. I will also suggest that Far East to Europe will grow by at least 8% in 2009. But do not expect to reach the heights of 2008 before 2012.

With supply as it is, this suggests that the shipowners and operators will have another bad year ahead of them.