Recovery depends on demand upturn in Chinese industrial segment: ICRA

Regarding the impact on the shipping sector, K. Ravichandran, Senior VP and Group Head, ICRA Ratings, mentions, “While, the tanker segment witnessed moderation from the highs witnessed in Q4 CY2019, the Baltic Dry Index and Baltic Capesize Index witnessed a steep decline with the Capesize Index turning negative for the first time on account of the impact of the Coronavirus outbreak on the industrial activity in China. The impact was also a result of the vessels getting stranded at Chinese ports, which were being diverted to other locations or were waiting in the sea, unable to deliver cargo to China. Overall, the impact of Covid-19 is a negative for the shipping sector and any recovery will be dependent on the demand recovery in the Chinese industrial segment, following the abatement of Covid-19.”