2024 Shipping Industry Expectations
As with most industries, maritime shipping faced a number of challenges in recent times due to the pandemic and its effect on the supply chain. What do the next 12 months have in store? Our staff at DJ Products, makers of the motorized trailer dolly, takes a look at predictions for 2024.
1. Reduced rate levels
Factors such as access capacity, weak demand, and a sluggish world economy will result in lower average rate levels for Transpacific Eastbound trade. In order to manage capacity, carriers may implement strategies such as slow steaming, in which cargo ships travel at less than maximum speeds, and blank sailing, which involves canceling sailings that were previously scheduled. Unfortunately, these strategies often lead to reduced service reliability.
2. Change in pricing behavior
While the past few years have seen a relatively uniform pricing policy, that will most likely end in 2024. Larger carriers with greater capacities will become more aggressive in their pricing to put a squeeze on smaller carriers.
3. Consolidation of carriers
In the face of declining profits and pressure from price-driven competition, smaller operators will struggle, leading to carrier consolidation to avoid financial disaster. In addition, consolidation improves scalability and global reach, two attributes that will be crucial in weathering upcoming challenges.
4. Reversal of fortune in East Coast and West Coast ports
Difficult labor negotiations caused West Coast ports to lose significant volume to East Coast and Gulf ports. This year, the pendulum swings to the other side due to expiring port labor contracts in the East combined with issues in the Panama and Suez Canals.
5. Continued greening of the shipping industry
Alphaliner, a shipping industry database, reports that global container lines reduced greenhouse gas emissions by 12 percent between January and July 2023. The new year may bring regulatory guidelines, such as an end date for constructing fossil fuel-only vessels.
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