If container lines really start parking ships in significant numbers, it may have more to do with 2012 than with their dismal financial results this year.
That’s because the slide in freight rates this fall presages a tough rate environment for ocean carriers heading into the trans-Pacific contracting season that typically begins in the spring.
“The movement of the spot market works its way into contracting,” Ron Widdows, who retired last month as president and CEO of NOL Group, told the annual Textile and Apparel Trade & Transportation Conference in New York last week.
That’s one reason he expects to see the idling of ships that hit the industry in 2009 resume in earnest in 2012. “I do believe there will be a substantial amount of capacity that will be parked,” he said.
“That huge bump in ship idling we saw before, something like that will happen again,” Widdows said. “Will it happen before the trans-Pacific contracting period? It could, but probably not.”