Limited vessel supply and high demand mean elevated project cargo rates are likely to endure in 2025, according to Drewry, the maritime research and consulting firm.

The MPV market shows a positive outlook for charterers and shipowners, it said, despite challenges such as geopolitical conflicts and expected trade tariffs. Both its General Cargo and Project Cargo indices are expected to rise in 2025.

Looking ahead, Drewry said the sector will likely see only “muted” deliveries over the next two years, while a “significant portion” of orders scheduled for 2025 will be replacement tonnage, hence growth will be “marginal.”

“A tight supply of project cargo will persist due to a low orderbook, resulting in higher charter rates. Furthermore, if delays in deliveries increase in 2025, we may see rates surging next year for project cargo,” Drewry said in a January briefing.

Scrapping picked up in the fourth quarter of last year, however Drewry noted that 40% of General Cargo vessels are over 25 years old, with a significant number of vessels over 30 years old. Many owners are delaying demolition since vessels are operating above break-even levels.

Drewry said demand for project cargo vessels will be “robust” in 2025, particularly on intra-Asia trades, supported by energy projects that remain on schedule. However, geopolitical risks, potential tariffs, and mild El Nino effects could significantly impact global trade, particularly for general cargo and bulk commodities.

Demand for grain, fertilizer, steel and other construction materials is expected to rise significantly through 2025, which will boost the demand for general cargo and project cargo.

“Nonetheless, the ongoing global conflicts and potential policy shifts following the US elections pose considerable risks,” the analyst said.

In October, Drewry introduced Breakbulk Sea Transport Indices for both Project and General Cargo vessel segments, replacing the previous Multipurpose (MPV) Time Charter Index.

Drewry said the new indices highlight the relative strength of project cargo, with carriers in this niche vessel segment experiencing a stronger market than general cargo since the COVID boom.

“With further increases in project cargo volumes anticipated in the second half of this decade, we expect the current divergence in market dynamics to continue,” said Dr Ferenc Pasztor, Drewry’s head of ports and specialized shipping research.

“To better present the status of the discreet sub-categories within the overall multipurpose shipping sector, we have introduced these new Breakbulk Sea Transport Indices, which will be updated and published monthly on the Drewry website.