An unprecedented crisis in the maritime transport sector in the world... Can companies dispense with it? And what are the repercussions of that?

There have been many misfortunes in the maritime shipping sector during the past months. A giant ship was stuck in the Suez Canal and disrupted navigation for several days. The cost of sea freight increased, and an arsenal of ships accumulated near the ports waiting for unloading or loading, and many transport companies suspended their activities due to the Corona virus.

And the British newspaper “Economist” says that all these factors made the shipping sector witness an unprecedented crisis in 2021, as the average cost of transporting a large container, 40 feet in length, exceeded 10 thousand dollars, and this represents four times the price last year.

For example, sending this container from the Chinese port of Shanghai to New York in the United States, the year before last cost about 2500 dollars, and now the cost has reached 15 thousand, as for obtaining a place for this container to transport it within a short period from China to the American West Coast, its cost up to 20 thousand.

desperate solutions

All these fluctuations prompted some companies to resort to desperate solutions, as Peloton, which manufactures expensive bicycles, resorted to air transport, although its cost was already high, and doubled in early 2020, and Wal-Mart chains And Home Depot, the two American retailers, decided to run their own cruises.

As for the method of using unsuitable ships, it caused great risks, as an attempt last July to transport containers, on a ship designed to load coal and iron ore, caused an imbalance and forced the ship to return quickly to the port.

At the same time, reliance on the train increased to transport containers across the Asian continent, and some companies resorted to transporting their goods by trucks from Asia to Europe to be shipped across the Atlantic Ocean to avoid overcrowding in Chinese ports.

The newspaper points out that trains, planes and trucks remain solutions of limited effectiveness, especially when it comes to transporting goods for long distances across the world, as sea freight ships transport a quarter of the goods that are exchanged in the world, and companies often find themselves in front of two options, either paying exorbitant prices And bear the delays in the ports, or the non-transportation of goods at all.

Over the past years, the maritime transport sector has continued to supply global markets with goods, after it became common for store shelves to be filled with goods coming from the other side of the world, and this sector was not under the spotlight, given that sea freight was very cheap and carried out smoothly.

Currently, with increasing delays and increasing prices, sea freight is losing its reputation as a reliable and convenient option for all companies.

What is worse is that most experts do not provide optimistic forecasts. They do not wait for an improvement in the speed and cost of sea freight before next year, and this deteriorating situation currently could lead to the restructuring of global trade in a different way.

Many transport companies have suspended their activities due to the Corona virus (Getty Images)

Ongoing crisis

On this crisis, Stephen Gordon, a mediator in the field of ship trade, believes that this sector in 2019 was witnessing a balance between supply and demand, and after the outbreak of the Corona virus, shipping companies expected a contraction of trade movement in the world, and 11% of the ships that were in service.

In fact, what happened was contrary to expectations, as global trade maintained the same pattern, and then began to achieve a great recovery, especially thanks to the financial aid obtained by the Americans, who started directly to spend it.

Some experts believe that the situation of maritime transport in the world will not return to normal before the date of the Chinese New Year, in February, which is the season when the pressures on ports usually decrease.

Even if the demand of American consumers returns to its normal levels, the companies will then refill their warehouses that were completely emptied during the last period, and there are indications of the beginning of a rise in demand for goods on the European continent as well, which predicts the continuation of the shipping crisis in the world.

Amid these crashing waves of crises and blurring of vision, the only thing that is certain is that this sector has achieved unprecedented profits during this crisis.

Accordingly, these companies tend to contract for the purchase of more shipping vessels, but the processing of these orders can take 2-3 years, especially with the decrease in the number of shipyards in the world compared to previous years.

It is worth noting that the shipping sector is responsible for 2.7% of carbon emissions in the world, and it is facing great pressure to move to clean energy, or at least reduce the pollution it causes in the air and sea, and it is expected that these shipping companies will face restrictions and strict government procedures, which will enter Effective from 2023.