AT the risk of disregarding an entire corner of the shipping industry whose job it is to research these things, the success of the dry bulk industry hinges on a fairly simple question: how many tonnes of stuff is there to move and how many ships are available to move it?

If the former is more than the latter, it’s time to buy dry bulk shares.

To simplify things even more, Chinese demand has been the key metric to look at for decades, and for decades it’s only been going in one direction. It’s been said before that to work out Chinese iron ore demand, for example, you should ask Brazil and Australia how much they think they will dig up, because China will have it all.

There are signs that could be changing. China’s construction boom is tailing off — the woes of its real estate market have been well documented — and Beijing’s recent stimulus packages haven’t excited bulker owners as much as in the past.

But talk to analysts and you’ll find the uncertainty around China’s iron ore and coal demand is causing far less anxiety than you might expect.

Beijing’s desire for security and ownership over the supply chains for its key commodities has redrawn trade lanes, with Guinea now squarely in the picture.

The West African nation holds the world’s largest untapped iron ore reserves. This is now finally being unlocked through the Simandou project, which has begun shipping cargoes. It also boasts a healthy amount of bauxite too.

The latter is the raw mineral in the production of aluminium, a metal of increasing importance to China’s booming automotive market.

Chinese interest in Guinea, as well as the higher iron content of its iron ore, means Beijing is likely to step up its imports from West Africa at the expense of Australia.

Why does that matter for dry bulk?

Well, the journey is more than three times as long. Tonne-miles will matter in the future more so than tonnes.

This post-demand theory could equally be applied to coal, about which the demand questions are much louder.

Again, Beijing’s desire for commodity security here is paramount. China produces most of the coal it consumes itself, but imports are a handy safety blanket, should price dictate.

Last year presents a neat case study. The first half of 2025 saw record domestic coal production and sharply declining imports, but prices fell and new safety regulations were rolled out. Domestic production subsequently slowed in the second half and imports clawed back some ground.

It’s more than possible to have a situation where Chinese coal imports actually outperform coal demand. Equally it’s more than plausible that iron ore demand could stagnate or decline and capesizes could actually do better, thanks to the greater tonne-miles on offer.

Beijing will not tolerate a lone pressure point in its supply chains, nor any situation where it can be held over a barrel.

In this market, it’s the tonne-miles that matter, not the tonnes.

Joshua Minchin,
Senior reporter, Lloyd's List