Clarksons: 2023 a positive year for shipping as China delivers 50% of shipbuilding output

Clarksons: 2023 a positive year for shipping as China delivers 50% of shipbuilding output

Home Clean Fuel Clarksons: 2023 a positive year for shipping as China delivers 50% of shipbuilding output

Seaborne trade has witnessed a notable uptick in 2023, registering a 3% increase to a $12.4 billion, according to data from Clarksons Research.

Courtesy of Capital Ship Management

The global maritime landscape further unveils a 3% growth in the world fleet, reaching an 2.3 billion deadweight tons (dwt). Despite this expansion, the newbuilding orderbook demonstrates a measured 3% year-on-year increase, standing at 126 million compensated gross tons (CGT).

With shipbuilding production experiencing a substantial 10% year-on-year boost, reaching 35 million CGT, a noteworthy milestone has been achieved: China now contributes to over 50% of the total output for the first time in history.

Amidst this thriving industry, significant regulatory changes aimed at curbing emissions have been introduced. Simultaneously, the sector witnesses increased investments in alternative fuels and energy-saving technologies, showcasing a concerted effort to navigate the evolving landscape of sustainable shipping practices.

A closer examination reveals robust freight and day rate levels within the realm of “energy” shipping, encompassing gas, tankers, and offshore oil and gas sectors.

Strong rates were led by the LPG sector with an all-time high VLGC rates $91,625/day, and also supported by another strong year for tankers. LNG rates were down but still healthy and a continued offshore recovery (“Floater” drilling rigs hit 90% utilization for the first time since 2014), Clarksons noted.

“Although our average day rate index, the ClarkSea, fell y-o-y (driven by a now “normalized” container market), it remained 33% above the ten-year trend with gas, tanker, offshore, and car carrier all experiencing strong conditions and dry bulk and containers (Red Sea disruption) rallying late on. With a return to trade growth and a good flow of newbuild and S&P, it was a positive year for many market segments across the shipping industry,” Steve Gordon, Global Head of Clarksons Research, said.


The market saw another very strong year, with average tanker earnings remaining elevated at $40,775/day (steady y-o-y, 2022: $40,766/day), with continued support from longer-haul trades following the redistribution of Russian oil flows post-Ukraine conflict. VLCC earnings increased by 80% y-o-y to $43,206/day on the back of rebounding Chinese crude imports and increased Atlantic exports. In contrast, earnings in the Suezmax and Aframax sectors remained very robust, exceeding VLCC earnings for a third consecutive year. Clean MR earnings eased slightly but remained very robust at $26,948/day.


2023 was a softer year for bulkers, with average bulk carrier earnings falling 40% y-o-y to $12,371/day, amid reduced fleet inefficiencies (e.g. congestion) and impacts from cumulative fleet growth over recent years (offsetting firmer demand trends). The fourth quarter was seasonally stronger with earnings averaging $17,468/day. Capesize spot earnings averaged $12,429/day in 2023, similar to the weak 2022 level, while earnings in the smaller segments dropped back.


Freight and charter rates dropped back in 2023 as the market ‘normalized’ from exception 2021-22 levels, with average freight rates down 71% y-o-y and average charter rates down 68% (but remaining above pre-Covid 2019 levels). The outlook suggested that rates would “bump along at the bottom” in 2024, but with the disruption in the Red Sea (over 300 containerships of 4m TEU have now diverted via the Cape), Shanghai to Europe box freight rates have, for the moment, trebled (but are still 65% lower than the Covid-19 peak).


VLGC spot earnings were exceptionally strong, rising 69% y-o-y to an all-time high of $91,625/day, on the back of firm US-Asia LPG trade, a wide West-East arbitrage and disruption at the Panama Canal.

LNG rates softened y-o-y (from an all-time high 2022) but remained healthy, with spot rates for a 160k cbm DFDE vessel averaging $97,077/day, 34% above the ten-year trend. With a significant orderbook (52% of the fleet), the fleet is poised to expand strongly in the coming years to help support a record volume of liquefaction capacity set to come online across 2025-27, Clarksons anticipates.

Offshore Oil & Gas

The offshore oil & gas markets continued to strengthen, with the Clarksons Offshore Index (tracking OSVs, rigs and subsea vessels) rising to the highest level in over 15 years; offshore wind markets had a more mixed 2023 suffering from some inflation pressures and project delay, but the underlying longer-term outlook for wind still remains positive.

Chemical Tankers

Chemical tanker market conditions generally remained strong in 2023 with swing tonnage continuing to trade in the CPP market, though some easing was seen from record levels in late 2022. The 1yr TC rate for a 19,999 dwt ship averaged a record $19,292/day across 2023

Car Carriers

Charter rates remained at all time highs, with support from record trade volumes, including surging long-haul Chinese exports (notably of EVs). Since 2019, global seaborne car trade in ceu-miles has grown by 19%, vs a 1% expansion in fleet capacity. By the end of 2023 the 1yr TC rate for a 6,500 ceu PCTC stood at a record $115,000/day, having remained above $100,000/day since late 2022.


Global shipyard output increased 10% y-o-y to 35m CGT (with China delivering 50% of output for the first time). There was a good flow of orders across 2023 (down 19% y-o-y in CGT but up slightly in DWT to 109m) with an increase in tanker orders (+235% by dwt, albeit from a low base). The orderbook is still overall only 12% of the fleet but is highly skewed to containerships and gas carriers in the coming years (meaning some potential constraints for tanker and bulker supply). Yard “forward cover” is a healthy ~3.6 years and our overall newbuild price index rose 10%.

Seaborne Trade: Recovery & Distance

After stalling in 2022, and despite the sometimes gloomy economic forecasts at times last year, global seaborne trade increased by 3% to 12.4bn tonnes. Clarksons is projecting 12.6bn seaborne trade in 2024. Top performing trades (by volume) in 2023 were Cars (+15%), LPG (+6%) and, supported by China’s reopening, Dry Bulk (+4.3%) while container volumes remained weak (but bottomed out in the summer). And a 5% increase in global seaborne tonne-mile trade (a full year of redistribution of Russian oil flows supported oil / oil products tonne mile growth of 7% / 10%) represents the biggest growth since 2017: a helpful “distance kicker”. In Cruise, passenger volumes returned to pre-Covid-19 levels of 31m and some market optimism is creeping back.

S&P volumes have remained at elevated levels (steady y-o-y at 129.9m dwt) with tanker and bulker prices up ~15%. Scrap volumes remained low (10.7m dwt) with pricing steady ($510/ldt).

Financiers reported an active year but with strong competition for “top tier” and early repayments, while capital markets were generally quiet.

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