Following a lockdown-induced export collapse and subsequent softening of containerised imports, containerised exports recovered sharply from mid-Q3 onwards, with no signs of slowing down. The last quarter of the year showed growth in both imports and exports, thus making solid strides towards returning to normalcy.
For Indian trade, 2020 was a year dominated by unprecedented challenges, irregular manufacturing and buying patterns, disrupted trade environments and lack of predictability. With the COVID-19 pandemic spreading across the world in a staggered manner and in varying proportions, the impact on containerised trade was felt the most in Q2 / 2020 when exports contracted by 34 per cent. As societies began to find ways to coexist with COVID-19, trade started recovering in the second half. Exports ramped up sharply in Q3, not only recovering from Q2 slump, but even increased by 14 per cent year on year, however the economic impact on consumers led to substantially lower imports, which dropped by 28 per cent as compared to the same period of 2019. The last quarter of the year showed growth in both imports and exports, thus making solid strides towards returning to normalcy. Demand for Indian exports across multiple categories continues to remain exceptionally strong, much of it driven by consumer demand in North America and Europe. Steve Felder, Managing Director, Maersk South Asia, said, “Despite unprecedented challenging conditions, stakeholders across supply chains – from manufacturers to consumers, from government bodies to logistics enablers – all stood up cautiously to fight the pandemic. Without the contribution from all the moving parts in the complex machinery of global trade, the path back to normalcy would not have been possible.”
Overview of trade for Q4 and full year 2020
During Q4 of 2020 (October to December), Indian containerised trade grew 13.2 per cent as compared to the same period in 2019. This was the first time in the year when both exports and imports grew in a quarter. Exports from India had shown a V-shaped recovery since mid-Q3, whilst imports had remained subdued for a long time owing to low demand in the market. In Q4, this trend changed notably, with exports stabilising at a high level and imports bouncing back significantly by 36.3 per cent over the previous quarter, thus moving the needle for overall trade recovery. During the year, exports contracted in the first half and increased in the second half, consequently posting a full-year marginal growth of under one per cent as compared to 2019. Imports delivered a full-year 14 per cent contraction as compared to 2019.
Commenting on the current situation and outlook, Felder said, “The challenges that we face today and the extraordinary situation we are in is not going to last forever. This is a temporary phase that will pass, and we are already on our way towards normalcy. We can see overall trade improving and economies getting back on track. The vaccination drive is picking up pace worldwide, and this is going to be the single most important aspect to bring trade – and life – back to normal.”