Box Trade Moves toward Recovery

Recession ravaged one economy after another in 2009, fulfilling earlier dire predictions for the global container industry, said Drewry Shipping Consultants in their latest Market Review & Forecast. Containership lines had to cut back drastically this year and still were not able to match the dramatic drop in volume.

Over-capacity has become the most critical issue facing ocean carriers. Managing it and keeping costs contained needs some clear management focus if container businesses are to survive the challenging market conditions that will prevail until at least 2014, the report said.

But the report is not entirely pessimistic. Global traffic should recover a little in the second half of 2009, and trade flows may recover by around 2.4 percent in 2010, Drewry predicts.

Drewry forecasts average all-in East-West rates will climb approximately 18 percent. Costs have been held down, and wages, no longer driven by shortages of skilled mariners, are no longer rising, Drewry said.

Contact Thomas L. Gallagher at tgallagher@joc.com.