By Arthur Photo：flickrpd  Link：Pickupimage

On August 30th, Mai Boliang, Chairman and CEO of CIMC Group, made a comment on the development prospects of the container transportation industry, which is the most concerned by the current market. The shortage of shipping space shall keep going to next year.

Sea freight has hit a record high, and the volume of freight on the trans-Pacific trade route is more than ever before. The boom in the container shipping market has allowed global new orders for container ships (measured by capacity) to more than double in less than eight months this year. Even so, considering the soaring demand and the need to transform the fleet due to strict environmental protection requirements, the supply of container ships may remain tight in the next few years. In other words, despite the surge in new ship orders in the future, the supply of ships and available space will still be in short supply!

According to "Hellenic Shipping News" (Hellenic Shipping News), there are currently 619 containership orders that will be delivered in the future, and there will be 381 in 2021 alone. The order capacity reached 3.44 million 20-foot standard containers (TEU) in such a short period of time. According to statistics, the current containership order has a capacity of 5.3 million TEU, and it is planned to join the fleet in 2023. At the beginning of 2021, the order capacity was only 2.5 million TEU. Since then, order capacity has increased by a record 3.3 million TEU, which shows that shipowners are investing heavily in new capacity.

According to the report, the largest number of orders for containerships with a capacity of 16,000 TEU were placed in the order of 60 ships from only 5 shipowners from February to June this year. In recent years, due to trade frictions and the outbreak of the covid pandemic, shipowners have noticed different trade patterns. The more "universal" 1,3000-16,000 TEU container ships are more popular than ultra-large container ships (ULCS). Despite the recent sharp increase in container ship orders, shipping industry executives believe that the surge in demand for container ship services and the complexity of rebuilding the fleet for environmental protection mean that there may still be a shortage of container ships in the next few years. At the same time, the supply chain problems caused by the pandemic have pushed shipping costs to historical highs. The shortage of ships has increased the possibility of continued high freight rates. This is not good news for retailers and consumers. The jump in freight rates puts huge pressure on corporate profits. The shipping cost for an American company to import goods from China is 10 times higher than before. It used to cost 1800-2200 US dollars to transport a 40-foot container to the West Coast of the United States. Now it costs more than 24000 US dollars, and the shipping company is really making money!

The total revenue of the nine major shipping companies (80% of the container shipping market) in the first half of the year exceeded 100 billion U.S. dollars! Net profit exceeded the whole year of last year. I don't know if I don't count it, I'm surprised when I count. The total operating income of the world's nine largest container shipping lines in the first half of this year has exceeded 100 billion U.S. dollars, reaching 104.72 billion U.S. dollars. Among them, the first half year net profit is more than the total net profit of last year, reaching 29.02 billion U.S. dollars, last year it was 15.1 billion U.S. dollars, it can be described as they are sitting on top of gold mine ! The nine shipping companies include Maersk, CMA CGM, COSCO, Hapag-Lloyd, Evergreen Shipping, HMM, Yang Ming line, Wan Hai line and Zim line . In the current market, the US trade rose the most, but the European trade did not fall. It is no wonder that the biggest headache for US President Biden to solve at present is the inflation problem. Inflation rate has been higher than 5% for six months in a row. In reality, measuring the imbalance between supply and demand of container transportation can only temporarily allow shipping companies to make big money, and give priority to lowering the primary raw material market such as oil, natural gas, and iron ore. Customers still need to wait patiently for the reversal of the container shipping market next year.