In the 1960s, there was much upheaval with regards to the container shipping industry, with the United States launching Container Boxes it with also the first purpose built shipping lines meant to carry them across the seas and oceans. That’s when stakeholders in the industry had to rethink their strategy, bringing in new ideas to make the shipping industry bigger and better. Now, the freight industry is going digital, with big data and IoT (internet of Things). Thus, we now look at the future of container shipping from this era.
Global trade was essentially founded in the 1800s with sea freight taking dominion with the various blooming empires in the world and the innovations of the Industrial Revolution. With it, transport costs were reduced and not to mention, with specific countries specialising in various production, global trade was at a peak. However, with the onset of WWI, the Great Depression, and WWII, global trade took a momentary leave of absence but yet, global trade growth picked up right after and steadily growing, especially with the help of container shipping which was introduced in 1956.
With the global trade increasing, the use of container shipping for sea freight has steadily grown as well, with more of a share of the industry taken away from the likes of breakbulk cargo, also referred to as non-containerised cargo. Whilst the growth slowed down during global financial crisis, since 2012 traded goods including non-containerised cargo has steadily increased with the Global Domestic Product (GDP). The containerisation ratio which is the measure of seaboard cargo transported in container has stabilised at 13%, which showcase a positive in the future of container shipping.
However it should be noted that number of trends are causing the multiple of container to trade growth over the GDP growth to slow down. These include the following;
- Growth in Emerging Markets – China’s integration into the global economy contributed greatly to trade growth in manufacturing, and in 2015 it contributed to the four fold increase movement of 20-foot- equivalent units (TEUs) from the year 2000 (from 13 million TEUs to 52 million TEUs), thus something to look forward to in the future of container shipping.
- Changing Manufacturing footprints – With the changes in the manufacturing sector with focus on digital technologies, geographics of where production used to take place are facing new changes. This has caused “reshoring” in certain areas with labour often being replaced by new manufacturing technologies. However, this is also dependent on the country or region in question and not entirely dependent on labour costs.
- Dematerialisation of Demand – With societies and regional economies getting better, the demand for goods is overcome by demand for services, thus you need to look into the regions and how they are approaching dematerialisation and how that will in turn change the future of container shopping due to low demand for goods.
- Uncertainties in Geopolitics and Policy – With changing temperatures in geopolitics and the various policies that have promoted global trade in the past via trade deals and more. However, with many stalling due to politics, the future is dependent on the agenda of the politicos of controlling countries.