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As historic a year as 2020 has been, its impact on the container shipping sector could be even more so. As COVID-19 played out through the spring, summer, and fall, a transformation years in the making materialized as ocean carriers showed new, arguably unprecedented discipline on rates, and newfound flexibility to adjust deployed capacity. The result: strong profitability amid a global recession. Cargo owners, freight forwarders, and other supply chain interests already are feeling the impact — and perhaps should prepare for it to be the new normal. Ultimately, carriers’ newfound discipline could be positive for all, but only if service levels improve in a way that creates greater value throughout the international supply chain. As of early November, rates in the eastbound trans-Pacific and Asia-Europe trades were sustaining record levels. What will that mean if the trend continues into Chinese New Year in early February, as many expect? Will carriers work to improve poor service levels and reliability that many shippers have lamented this year, and if not, does that set the stage for contentious contract talks next spring? How should shippers adjust to the protracted disruption brought about by equipment dislocation and congestion at primary gateways? This webcast will analyze the year that was and take an early look at what lies ahead in 2021.

Mark Szakonyi, Executive Editor, JOC.com and The Journal of Commerce, Maritime & Trade, IHS Markit

David Bennett, President, Americas, Globe Express Services

Rahul Kapoor, Vice President and Global Head of Commodity Analytics & Research, Maritime & Trade, IHS Markit

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The remarkable turnaround in ocean carrier fortunes is the freight transportation tale of the COVID-19 pandemic. Through tight capacity controls, the world’s global container shipping companies were able to rapidly match a decline in volume during second-quarter pandemic-related lockdowns that were as high as 30 percent on some trades. This ability to quickly flex capacity dramatically improved the financial performance of all carriers, even those that have long run in the red, such as HMM and Yang Ming. It has put them on course for a 2020 profit that SeaIntelligence Consulting estimates could reach $15 billion. Tight capacity management is here to stay — a structural change, according to Maersk CEO Soren Skou — and shippers will need to find ways to work within the adjusted networks. But the collective management of capacity has attracted the attention of regulators in China and the US, which will be a troubling development for carriers trying to manage uncertain trade flows. Outside of the operational aspect are shipper relationships that have been bruised by the carriers’ response to the pandemic. Container shipping prosperity has been accrued at the expense of their customers, with shippers facing disruption to service levels, difficulties in securing capacity despite holding annual contracts, and soaring rate levels. These relationships will need to be mended as the industry moves forward into a future characterized by uncertain demand from recession-hit consumers, volatile rate levels on all major trades, and the second wave of COVID-19 outbreaks across Europe that is disrupting supply chains.

10:00-10:05 AM Welcome Remarks

10:05-10:30 AM The European Economic Outlook: Resurging COVID-19 outbreaks across Europe are weakening the regional economic outlook and raising concerns that the strong third-quarter peak season will be followed by an extended period of weak demand as consumers hunker down through the winter.

10:30-11:00 AM Container Shipping - What Lies Ahead? The carriers are heading for a highly profitable year with the unexpectedly strong volume on the Asia-Europe trade through the third-quarter peak season, but the demand from European importers as we head into 2021 remains uncertain. The economic damage of COVID-19 has been substantial, and it will only be a matter of time before that begins to impact the flow of goods. What can shippers and forwarders expect in the year ahead, and how do carriers see demand developing?

11:00-11:30 AM Avoiding the Air: Air cargo space is at a premium again with an intense end-of-year peak season filling all available capacity. The tight supply will remain until belly cargo returns at scale, which could be years even without the huge amount of capacity that will be required to transport a COVID-19 vaccine starting next year. That leaves shippers with a clear choice: accept high air cargo prices or shift your supply chain to ocean or rail.

11:30 AM-12:00 PM Europe’s Hub Port Challenge: IHS Markit Port Productivity data show container exchanges per ship are increasing at European gateway ports, driven by the deployment of mega-ships on the Asia-Europe trade. While the rising call sizes slowed through the second quarter as COVID-19 impacted demand, the trend is here to stay, keeping pressure on terminals and inland connections as import volumes recover.

12:00 pm Closing Remarks