With wars, epidemics and aggressive interest rate increases by central banks such as the Federal Reserve, there are finally clear signs of cooling in the global economy.

Freight rates continue to fall as demand for commodities shrinks and global trade slows, according to the latest data from Standard & Poor's Global Market Intelligence. According to the research team,Freight rates have also declined as a result of the easing of supply chain disruptions during the outbreak, but the slowdown in demand for containers and ships is largely due to the weakening of cargo flows.

Freight rates for containers and dry bulk carriers (or ships carrying raw materials and bulk cargo) have fallen over the past three months, S & P said. Freight rates peaked in the second quarter, earlier than expected, the agency added. "dry bulk freight prices usually peak in the third quarter because of the seasonality of the market," the company said. However, according to S & P Global Market Intelligence's latest dry bulk market outlook, the second quarter could be a peak in 2022. "

The company's freight rate forecasting model showsThe Baltic dry bulk freight index, which is also a barometer of seaborne prices of major raw materials, is expected to fall by about 20% to 30% this year and pick up slightly in 2024.

The decline in global shipping activity indicates that the risk of a global recession is increasing as the cost of living rises and inflation and consumer demand declines. A key sign of the global recession is stagnant global trade growth. WTO's latest barometer of merchandise trade also highlighted this recently.

The global trade barometer report released by WTO in August shows that the volume of world merchandise trade has leveled off. Year-on-year growth slowed to 3.2 per cent in the first quarter of this year from 5.7 per cent in the fourth quarter of 2021. WTO believes that the economic slowdown is partly due to the war between Russia and Ukraine and repeated epidemics in Asia. The report also said that although the WTO forecast that global trade would grow this year, the uncertainty surrounding this forecast had increased due to "continuing conflict in Ukraine, rising inflationary pressures and expected monetary tightening in advanced economies".

WTO predicts that the volume of world merchandise trade will grow by 3.0% in 2022. However, uncertainty surrounding the forecast has increased as a result of the continuing conflict in Ukraine, rising inflationary pressures and expected monetary tightening in advanced economies. The revised forecast will be released in early October.

Standard & Poor's Global Market Intelligence also responded to WTO's concerns.

"although we expect some seasonal improvement in the dry bulk market in the coming months, due to continued weakness in the real estate sector in Asia, slower-than-expected economic growth and no serious congestion, we expect a decline in volatility in the dry bulk market in the short term," said Daejin Lee, chief shipping analyst at S&P Global Inc. Market Intelligence.

S&P Global Inc. Market Intelligence Company believes that any variables in the epidemic, such as changes in prevention and control measures, or any substantial progress in the conflict between Russia and Ukraine, may once again raise the price of dry bulk shipments. However, a further slowdown in commodity demand and consumption will push down freight rates. On the positive side, the pressure on the global supply chain continues to ease, according to the latest global supply chain stress index of the Federal Reserve Bank of New York.