The growth of international trade has been a major driving force behind the sea freight forwarding industry, leading to significant structural changes in the shipping industry since the end of World War II.
The subprime crisis in 2008 led to a slowdown in global trade, causing a decline in sea freight transport growth and initiating a global economic crisis. This resulted in a collapse of demand for sea freight transport and freight rates, negatively impacting the profitability of shipping companies. As a result, the European Union revoked liner conferences that had been in operation for many years due to its opposition to rate agreements. This led to the creation of new agreements between shipowners called shipping alliances.
The subprime crisis in 2008 led to a slowdown in global trade, causing a decline in sea freight transport growth and initiating a global economic crisis. This resulted in a collapse of demand for sea freight transport and freight rates, negatively impacting the profitability of shipping companies. As a result, the European Union revoked liner conferences that had been in operation for many years due to its opposition to rate agreements. This led to the creation of new agreements between shipowners called shipping alliances.
The pandemic and geopolitical conflicts have led to a rise in raw material prices. This has caused many companies to order in bulk to reduce costs and prevent possible shortages. As a result, there is now an overstocking of goods and a decrease in demand for transportation. At the same time, we are witnessing a slowdown in world demand with a possible recession.
In 2023, new vessels are being introduced, and some older vessels are being withdrawn due to the need for shipping companies to bring their fleet into compliance with the new IMO 2023 regulations to reduce carbon emissions from international shipping.
The acceleration of the decarbonization of the fleet should lead to a reduction or even disappearance of the chartering offer, i.e., vessels chartered on an ad hoc basis to relieve port congestion. However, it will also lead to a reduction in capacity on the main shipping lines. To meet emission standards, ships will need to sail slower, which will require 10% more ships to transport the same amount of goods. This could drive up transportation prices even further. Rail transport is indicated as an effective alternative.
Learn more about the evolution of rates in sea freight from our e-book. 👇
