Trade Tech

Severe rate instability in the maritime environment, while not unfamiliar, will be significantly increased for the foreseeable future. We should expect to see freight volume remain flat with the dominance of uncertainty in both the American and European markets. That has already been enough to trigger aggressive price making, while the arrival of significant new tonnage will further stimulate an already turbulent market.

Price changes are becoming ever more frequent and creative. This may be good news for importers, but the challenge will be in auditing the final billings. Forwarders, NVOCCs, and third-party providers will be especially challenged to react to market changes that fend off competition and protect margins across a broad array of cargo movements and trade lanes.

We are projecting a move to greater reliance on information systems, which provide Expertise on Demand at the global level and particularly to integrated systems to manage the coupling of cargo opportunities with rate changes and audit or centralized accounting functions.

Nimble players will position themselves to leverage the massive quantities of information that will be generated by the creative destruction taking place in the market over the next 12 to 18 months. They will be quick to react to new opportunities in order to gain new business and will be more actively supported by carriers who recognize their ability to make good use of the incentives offered to them. In the end, the carriers will be looking to back third parties who can generate cargo bookings out of the rates they are given.

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