Container shipping volumes on wild ride
Short-term trend shows increases, but long-term volumes will stay low
Dave Hannon -- Purchasing, 6/24/2009 12:31:00 PM
While the number of containers imported through the Port of Long Beach is continuing to rise steadily, it is still not anywhere near what it was a year ago. And it might never be there again, according to some experts.
The Port of Long Beach said its import containers grew in May vs. April but were still well off the volumes seen a year ago. Since February, imports at Long Beach have risen nearly 40% to 208,591 20-foot equivalents in May, a slow but steady trend that could indicate international trade making a gradual comeback.
But there is a chance that Long Beach and its sister port Los Angeles will never see their previous glory days of container volumes and, in fact, the entire container shipping market may not see those volumes. In its State of Logistics report put out earlier this week, the Council of Supply Chain Management Professionals said, "The west coast ports, and particularly LA/Long Beach, are seeing what may actually be a permanent reduction in traffic levels. After decades of a virtual stranglehold on ocean freight activity in the U.S.-four out of every ten containers moved through these ports-they are losing market share. Other U.S. ports have made significant improvements in their infrastructure and operations, making them more attractive to carriers and shippers alike."
And shipping giant A.P. Moeller-Maersk forecasted that cargo volumes may drop more than 10% this year and show no growth in 2010 as the industry suffers a "completely unprecedented" decline, according to Eivind Kolding, CEO of the company's Maersk Line container unit. Kolding said current container freight rates are at levels not seen since the 1990s and that "Getting lower down from this point will actually mean you have to pay the customer to take his business."
See also: Freight demand dive may have hit bottom.
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