The global economic landscape has undergone a profound transformation over the past five years, shaped by a succession of disruptive forces that have altered market behaviour, redefined policy priorities, and recalibrated the trajectory of international trade. For the maritime sector, particularly the dry bulk market, these developments have not merely represented cyclical fluctuations but structural shifts whose influence continues to reverberate through freight dynamics, investment decisions, and commodity flows.
The Covid-19 pandemic stands as the first and perhaps most destabilising rupture in this sequence. Beginning in early 2020, what initially appeared to be a regional health crisis swiftly evolved into a global economic shock unprecedented in the post-war era. Supply chains froze, mobility collapsed, and industrial activity fell at a pace that echoed the severity of the Great Depression. The shipping sector felt the impact immediately. Container terminals were overwhelmed as disruptions cascaded through logistics networks, while dry bulk carriers idled outside key ports amid falling demand for energy, steel, and raw materials. The experience unmasked the fragility of globalisation’s “just-in-time” systems, revealing an extraordinary degree of interdependence between economies and production centres. Yet as lockdowns eased, the rebound was equally dramatic. Manufacturing hubs in Asia returned to high utilisation rates, retailers raced to rebuild inventories, and the surge in pent-up consumer demand generated a period of exceptional supply chain tightness. Freight rates responded accordingly, with congestion-driven inefficiencies and rerouted trade flows lifting earnings across multiple shipping segments. However, this intense pressure on logistics networks – combined with significant fiscal stimulus measures – set the stage for the global inflationary cycle that would follow.
By 2022 and 2024, the narrative shifted decisively toward inflation and monetary tightening. Price pressures that were initially dismissed as transitory became entrenched across energy markets, industrial commodities, and consumer goods. The response from central banks was both swift and forceful. Policy rates rose at the steepest pace in decades as authorities sought to restore price stability and curtail demand. For shipping, a sector highly sensitive to funding costs for both vessel acquisitions and infrastructure projects, the environment became markedly more challenging. Despite these headwinds, the global economy demonstrated a resilience that repeatedly defied expectations. Consumption remained robust in many advanced markets, supported by accumulated savings and stable labour demand. Industrial activity continued its gradual recovery as supply chains normalised, though at uneven rates across regions. Within dry bulk, freight markets navigated this environment with a mix of volatility and adaptability, reflecting shifts in procurement strategies, inventory management, and energy demand patterns.
Concurrently, a deeper structural trend began to accelerate: the fragmentation of global trade. What began as a collection of isolated tariff disputes between major economies expanded into a broader and more entrenched realignment of supply chains. Between 2024 and 2025, the concept of economic security gained prominence, prompting governments and corporations to prioritise resilience over pure efficiency. This reorientation produced significant changes in global trade flows. Production networks that had remained stable for decades shifted toward diversification and regionalisation. Asia, North America, and Europe each moved to strengthen intra-regional supply chains, while industries with high strategic value became increasingly shaped by geopolitical considerations rather than cost competitiveness alone. For the dry bulk market, the impact was tangible. Tonne-mile demand became more sensitive to political developments, sourcing decisions became less predictable, and new patterns emerged in commodities such as steelmaking inputs, agricultural products, and energy. While fragmentation introduced new opportunities in certain trades, it also heightened volatility and challenged traditional assumptions about flow stability.
By 2025 and 2026, attention shifted increasingly toward China, whose internal economic adjustments began exerting a decisive influence on global market conditions. After decades of rapid expansion built on scale and aggressive capacity growth, China confronted a series of structural challenges: excess industrial capacity, thin profit margins, and declining efficiency across multiple sectors. In response, Beijing elevated the concept of anti-involution as a strategic economic priority. Involution refers to the selfperpetuating cycle of hyper-competition in which companies expand output and cut prices merely to maintain market position, eroding profitability and depressing industry-wide margins. Anti-involution aims to break this pattern through stricter regulatory discipline, capacity controls, and incentives for innovation-led competition. This shift now extends across a broad spectrum of sectors, including steel, cement, solar technology, batteries, e-commerce, logistics, and consumer services. The overarching objective is to redirect China’s economic model from scale-driven expansion toward higher-quality, efficiency-oriented growth. For the dry bulk sector, the repercussions of this transition are nuanced. In the near term, stricter capacity management in steelmaking and construction materials may temper China’s appetite for some raw materials, leading to more disciplined procurement cycles. However, the medium-to-long-term implications may prove stabilising. A more profitable, efficiency-focused industrial base could create steadier demand for imported commodities, reduce the volatility associated with rapid capacity swings, and improve visibility in long-term trade planning.
As the market moves into 2026, the global economic narrative does not converge around a single theme but instead reflects the accumulated impact of these overlapping forces. The dry bulk sector begins the year from an especially firm position following the pronounced year-end rally of 2025. Freight rates across key segments ended the year at elevated levels, providing a constructive foundation. Forward curves reinforce this outlook. Capesize values are positioned below their exceptionally strong end-2025 levels, reflecting natural normalisation, while Kamsarmax and Ultramax markets continue to command a premium to last year’s realised earnings. Handysize returns remain steady, supported by resilient demand for grains, minor bulks, and non-ferrous commodities. Although challenges persist – including slower global trade growth, ongoing geopolitical tensions, and China’s structural adjustments – the sector appears well positioned to absorb these pressures.
The opening indicators of 2026 further validate this view. All Baltic indices stand well above their levels of a year earlier. The Kamsarmax segment, which ended this same week last year at $8,060 per day, now commands earnings more than $5,000 higher. The geared segments have also strengthened materially, with Supramax values at $12,220 compared with $9,663 a year earlier, and Handysize assessments at $10,578 versus $8,347 daily. Although the restructured Baltic Capesize index complicates direct annual comparison, the distortion cannot reasonably explain the nearly $8,000 daily difference evident in current market levels. These developments collectively illustrate a sector entering the year with momentum, supported by a favourable balance between supply dynamics and underlying trade demand.
Data source: Doric