China's cargo throughput growth slows in Q2 2024: Fitch

China's cargo throughput growth continued in the second quarter (Q2) of 2024, but the pace of expansion has decelerated to 3 per cent year-on-year (YoY), down from 6 per cent in the first quarter, according to Fitch Ratings. Total container throughput saw a 7 per cent YoY increase, bolstered by strong demand from Association of Southeast Asian Nations (ASEAN) countries, although domestic demand has shown signs of weakening.

China's export value rebounded in Q2 2024, rising by 4.4 per cent YoY, compared to a contraction of 1.7 per cent in Q1. This growth was largely driven by a 15 per cent surge in exports to ASEAN. Exports to the US also returned to positive territory, growing by 2.5 per cent YoY, while exports to the European Union remained flat, as per Fitch.

Shipping rates across various metrics, including the Shanghai Containerised Freight Index, China Containerised Freight Index, Baltic Dry Index, and Baltic Dirty Tanker Index, stayed elevated, largely due to the ongoing tensions in the Red Sea. Fitch Ratings anticipates that container shipping indices may moderate as a significant number of new container ships are delivered later this year.

However, Fitch cautions that recent economic data suggest increased uncertainty over global economic growth and sluggish consumer demand in major economies, which could limit the growth of port throughput. Additionally, rising geopolitical tensions and the potential for further US tariff hikes on Chinese goods, coupled with the possibility of retaliatory measures, pose further downside risks in the medium term.

Fibre2Fashion News Desk (DP)