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The first half of 2023 will remain challenging for our industry. In our webinar we will provide you with an update and introduce cargo-partner’s flexible portfolio of LCL solutions.read more
Read our Seafreight Insights to find out about the latest developments in the global sea cargo industry. Get an update on trade and rate developments as well as flexible solutions offered by cargo-partner to deal with the current challenges.
The first half of 2023 will be quite challenging, as global shipping has decreased due to various factors like excessive shipbuilding programs, lower consumer spending, rising inflation and geopolitical instabilities. Despite the short-term headwinds, economic indicators suggest a continued long-term growth in global container trade, driven by the key regions Asia-Pacific, South Asia, Middle East and Europe.
Global congestions have eased and are more or less at pre-COVID19 levels. There is a notable positive trend and only 8% of all goods shipped worldwide are currently stuck, compared to almost 14% at the peak of these bottlenecks in the past.
The number of blank sailings has steadily increased, which is clear when we look at the main trade lanes. For example, on the Far East to US West Coast trade lane, almost two-thirds of all sailings have been affected, amounting to nearly 200k TEUs per week. On the Far East to North Europe trade lane, blanked sailings have reached 120k TEUs per week. According to the latest estimate by Alphaliner, 1.3 million TEUs of container shipping capacities are currently inactive.
This is also reflected in the global carrier schedule reliability, where we can see a positive trend as the global average delay for late arrivals has fallen to five days.
The markets have changed fundamentally as spot rates have plummeted in various trade lanes and dropped to levels comparable to those seen in 2020. The Drewry Word Container Index fell below USD 2,000 per TEU in February, the lowest level since July 2020.
According to analysts, liner shipping in 2023 will generate only 5% of the mega-profits achieved last year. Carriers have implemented a range of measures, including a strict blank sailing program, and up to 25% of the massive order book will likely be postponed.
A significant increase in fleet capacity is expected in the coming years. Current order books represent close to 30% of the world’s existing fleet, and analyst forecasts expect a year-on-year fleet growth of 7% in 2023 and 2024.
Another significant development came from the top two leading container shipping lines – MSC and Maersk have announced that their 2M alliance will end in early 2025. In addition, MSC became the world’s biggest carrier in 2022.
Considering the three largest global alliances (2M, Ocean Alliance and THE Alliance), the world’s top nine carriers control 83% of global capacity. Future developments in the shipping industry are sure to remain interesting.
The shipping industry will remain volatile and uncertainties will continue to plague the market.
Legend: traffic lights showing current status, arrow indicates possible development of transport rates.