Container loading and unloading

Container loading and unloading (Photo: The DCN)

 

The traditional peak season for the shipping industry has come to an end, but spot rates have fallen over the past two weeks, a clear sign that the peak season never really materialized. This is according to a recent report by Sea-Intelligence, a Danish maritime data analysis company.

The report also notes that there are "dark clouds looming over the horizon" for the Transpacific trade, due in part to changing US consumer behavior. One factor is the shift from services to goods during the pandemic, which is likely to reverse and have a negative impact on import volumes.

"Digging deeper, we see that in recent months, the growth is concentrated on goods which are not predominantly moving in containers," said Alan Murphy, CEO of Sea-Intelligence.

 

 

Recreational goods and services have seen the highest growth, rising from 12% in 2019 to 17.2% by July 2023. The largest growth within this category is in 'Video, Audio, Photographic, Information Processing Equipment, and Media'.

The ‘Information Processing Equipment’, such as computer software and accessories, is also growing rapidly, but it is mostly not transported in containers. This means that container shipping lines are not benefiting from this strong boost to consumer spending.

Another major growth component on goods spending is the overall 'Vehicles' category. New vehicles are indeed growing well, but once again, these are mostly not containerized.

The change in US consumer behavior is a major challenge for the Transpacific trade. As consumers shift their spending from goods to services, the demand for imported goods from Asia is likely to decline. This will lead to lower freight rates and reduced profits for container shipping lines.

"Another major growth component on goods spending is the overall ‘Vehicles’ category. New vehicles are indeed growing well, but once again, these are mainly not containerized," said Murphy.

 

Source: Phaata.com (According to Sea-Intelligence)

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