THE current container crisis questions the enduring validity of globalisation and low-freight cost assumptions, say analysts from London's Drewry Maritime Research
THE current container crisis questions the enduring validity of globalisation and low-freight cost assumptions, say analysts from London's Drewry Maritime Research. 'Ocean carriers alone cannot remediate the current problems in the short term, and shippers will have to adapt their medium-term strategies,' they said, reports Mumbai's Indian Transport & Logistics News.
'More than 80 per cent of shippers reported serious issues with lack of shipping capacity, poor schedule reliability and high freight rates,' said Drewry.
'Furthermore, 40 per cent of shippers said that they are considering sourcing or exporting from a more local/regional location ?C a policy decision with the potential to substantially impact carriers' future deep-sea network and TEU-mile demand.' said Drewry.
There are a number of measures shippers, ocean carriers and ports can take to mitigate current container crisis, said the Drewry analysts.
The current medium-term plans of ocean carriers appear to focus on assets with a lag time between order and delivery to the market.
Ocean carriers do not appear to have short-term, contingency plans that can resolve the current market imbalances, other than attempts to stabilise schedules.
Said VesselsValue head trade analyst Charlotte Cook: 'We are seeing staggeringly high levels of congestion outside key import and export container hubs with a total of 2,661,942 TEU currently waiting globally,'
'This congestion has been a side effect of the container market recovery since Covid, and several factors including pent-up demand, terminal closures, labour shortages, and a lack of available containership tonnage,' said Ms Cook.
'With increased shipping expenses as a result of extended idling times and profit margins being squeezed in the shipping sector, we could see these costs trickle down to the consumer in the not too distant future.' said Ms Cook.
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