Supply and Demand in The Container Shipping Industry Towards Global Trends

Shipping industry is one of the back bone of the development of international trade. The international market is highly depending on shipping companies which enables different nations to import and export anything in this world. During 2008 and 2009, Global shipping industry experienced a hard time due to financial crisis. However, it had overcome in 2010 and made a solid growth in 2011. And it is keeping on growing as the enhancement of the world economy and new opportunities.

Political climate is one of the obvious factor which affects the market condition of the container shipping industry globally. And there is some factor listed below are some factors which affects the supply and demand in the container shipping industry.

The overcapacity in the container segment does not match the financial cycles:

Timing is another important factor for the balance of supply and demand. It is very hard to fit into the financial cycle to give a balance between supply and demand for the giant ships of 14000 TEUs. This is a difficult task in an unstable market where prices move vigorously and uncertainly.

Industries adapt their freight to the container shipping method:

Containerization is the new trend in this industry. Another trend is that industries are adapting containerization. For instance, the paper industry has reformed their freight to the container shipping method by changing the size of paper rolls to fit the containers. The freight is transported directly to the consumer, to make it more efficient and to decrease the risk of damages.

Increasing demand for customer focus and new technology:

We are in the era of a technical revolution where everyone in the full logistics chain from manufacturer to collector. Invest all the resources to develop new system to achieve higher efficiency. More transparency is expected by the customers within the entire logistic chain with the help of the development of IT systems.

Lower demand for shipments to & from the Far East:

China had a fast-economic growth during the recent decades and the country has been a great force for enhancing global trade. However, the earlier year we could see the predicted growth actually weaken which has headed to a lower demand for shipments to and from the Far East.

Capacity in ports raises faster than trade volumes:

There are many seaports contributing to an imbalance between supply and demand in some regions. Shippers need to select which ports to invest in and there is a risk with only a little big port monitoring the logistics streams. Single terminal operators might only keep attention in signing up with one or two alliances leads to no diversity in the industry.