Shippers face difficulties while container shipping lines' profits skyrocket

 
Import and export companies are facing a deadlocked container shipping market as deployed shipping capacity has not kept pace with the rebound in consumer and business demand and escalation of freight rates is beyond the reach of many small and medium enterprises (SMEs), according to the latest Container Shipping Market Review compiled by MDS Transmodal and the Global Shippers Forum (GSF).

The assessment showed a slight increase in the number of ships deployed, which allowed for higher container volume in Q2 after a lull in the first quarter of the year.

Mike Garratt, President of MDS Transmodal, said: “Global levels of container traffic grew again in Q2 2021 to reach record levels but have still not yet quite recovered to the level that trends implied 3 years ago, when lines reduced their level of new buildings”. And he went on to point out that "capacity shares based on vessel sharing agreements (or consortia) in some key markets now exceed 40%."

“Performance indicators, including skipped ports, continue to compare poorly with pre-pandemic levels,” he noted.

Furthermore, James Hookham, Director of the Global Shippers Forum commented that "Importers and exporters are facing a meltdown of the container shipping market, with rates in the stratosphere, slots up for auction and service performance in the trash. The prospects for the coming peak season look grim."

This was the quarter in which the impact of the Ever Given stranding clogging the Suez Canal was felt, but the effect was not discernible in a global picture of rising rates, service and number of trains. reduce.

“What none of the industry metrics show are the huge numbers of shipments that are not being moved – the boxes left on the quay, stacked in the terminal or stockpiled in export warehouses awaiting a slot," emphasized Hookham.

Meanwhile, carriers' margins have skyrocketed, and the assessment shows that average profit per container shipped has consistently increased relative to the cost of transporting that container - virtually unchanged over the course of the past 18 months. Globally, carriers are making more than twice as much profit per container as they were at the start of the pandemic.

Source: Phaata.com (According to Container-News)

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