In 2023, the global port and shipping industry is forecast to face many difficulties due to the economic downturn that negatively affects trade activities as well as shipping output.
Accordingly, the oversupply will put pressure on sea freight rates in the near future. While business results of shipping companies may have a certain lag with the fluctuation of sea freight rates because time charter contracts are usually signed from 6-12 months. Thus, the impact of the reduction in sea freight rates will clearly affect the business results of Vietnamese shipping lines in the period of 2023-2024.
However, according to VNDirect Securities there are still a few factors that positively support the industry outlook in 2023 such as the facts that container shortage has been resolved thanks to the additional supply of containers in 2022 and China is reopening, which will boost global trade and consumption.
Besides, VNDirect forecasts that the average Brent oil price will remain at around $90/barrel in 2023, which will help reduce fuel costs for shipping businesses and promote global trade.
It is believed that Vietnam's seaport industry will see positive growth thanks to a strong flow of FDI into Vietnam and some effective trade agreements. Accordingly, the RCEP Agreement, which came into force in early 2022, has boosted some Vietnamese manufacturing industries to achieve strong growth in the first half of 2022.
On the other hand, these trade agreements will positively affect Vietnam's import and export activities in the coming years when global consumption recovers, thereby benefiting Vietnam's seaport industry.
In addition, Vietnam's container volume is expected to grow at a compound rate of 8.6% in the period 2022-2030, in which Hai Phong port clusters with see a reduced oversupply and Cai Mep - Thi Vai port cluster is being upgraded and has the most potential incentives among the port clusters in Vietnam.
On top of that, in the period of 2023-2024, a number of expansion projects will be implemented and put into operation such as Nam Dinh Vu phase 2, Gemalink phase 2 and the deep sea port of Hai Phong port, which will bring tremendous growth potential for the industry.
Compiled by VietnamCredit