GLOBAL trade continued to grow throughout the third quarter in 2021. However, container shipping capacity was maxed out and shippers turned to a mix of air freight, rail services and own-charter vessels to move goods around the world. This is according to the most recent edition of the Container Shipping Market Quarterly Review, published by the Global Shippers Forum and MDS Transmodal.
GSF director James Hookham said the review shows the extent to which shippers sought out alternatives as shipping lines priced themselves out of reach and narrowed the cost difference with offerings from other modes. He said a measurable share is also accounted for by vessels that shippers chartered for their own goods, and by other non-liner carriers.
“The Great Shipping Crisis of 2021 has taken many casualties as shippers trapped between record rates and very poor service levels struggled to fulfil delivery deadlines for imports destined for the holiday sales season. Shippers will be watching anxiously to see how quickly these conditions abate in 2022, and whether the use of these alternative services will continue to grow,” Mr Hookham said.
“Shipping lines are attributing the cause of the crisis to severe congestion in ports and logistics bottlenecks inland. But this means that, as these conditions ease post-peak season and output dips in Chinese New Year, container shipping capacity levels should increase to match shippers’ demand more closely. This recovery in capacity could accelerate if consumers switch spending to services rather than goods, and interest rate hikes and higher energy costs take their toll on discretionary spending.”
MDS Transmodal chairman Mike Garratt said the review this quarter examines how alliance members have expanded their role in developing consortia and
“Our review this quarter has examined how alliance members have expanded their role in developing consortia and therefore market shares and the way in which they have addressed operational challenges in modifying route structures. This reduction in services linking multiple world regions has been accompanied by a decline in the number of countries that are directly connected,” he said.
“Given the dramatic growth in freight rates and declining service performance it is not surprising to see trade growing more quickly than container volumes on the established lines, as shippers have found other transport solutions; starting own shipping routes, using long-haul rail or air or semi-bulk traffics switching to conventional methods.”
The GSF produces the Container Shipping Market Quarterly Review every three months. Its aim is to interpret and comment on trends and developments in the sectors experienced and understood by shippers.
