Container Shipping During Pandemic
Container shipping during pandemic
The container shipping during pandemic had an unprecedented impact on global economies. Lockdown measures worldwide meant that manufacturing was halted, ports were closed, and shipping companies were forced to make dramatic adjustments to their regular schedules
Despite Asia’s prolonged struggles, it wasn’t until February 2020 that the global shipping sector started to really feel the impact of the Covid-19 pandemic. One of the most significant problems for the largest container shipping companies is the global container crisis.
Due to slower processes, abandoned trade routes, port congestion, and increased demand due to the pandemic, there are no longer enough shipping containers to meet current shipping demands. Blank sailings throughout the pandemic and a buildup of shipping containers mean the shortage continues through 2021.
To help meet demand, many shippers are sending vessels back to their points of origin empty. Many of the world’s largest shipping companies, such as Maersk, MSC, and CMA CGM, have to adjust strategies in real-time to adapt to the changing circumstances
Hapag-Lloyd made efforts to speed up container emptying and refilling time by 25% to maximize container use. This is one of several alternative strategies adopted by the liner to deal with the crisis
According to the United Nations Conference on Trade and Development (UNCTAD), the greatest increase in freight rates has been on trade routes between developing countries, where businesses struggle to afford the additional costs. At the beginning of 2021, freight rates between China and South America increased by 443%.
A byproduct of the pandemic that’s helping shipping lines with recovery is the increase in freight rates. Shipping companies have prioritized more profitable customers and trade routes, allowing them to survive while operating at reduced capacity.
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