Global container shipments set to fall 30% in next few months
Warehouses are getting so full of goods like fridges and washing machines that retailers are asking shipping companies to push back deliveries, which may drag global container shipments down as much as 30% in the next few months, according to the head of an industry group.
Shipments have probably fallen about 15% so far this year amid the coronavirus pandemic, according to International Chamber of Shipping Chairman Esben Poulsson. Second-quarter declines, compared with a year ago, will depend on by how much governments reopen economies, he said.
“Inventories of goods like apparel, textiles, white goods, are full,” Poulsson was quoted as saying last week. “We are hearing of receivers of these goods asking shipping lines whether they can store these goods for a period of time or slow their ships down or basically delay taking delivery.”
The slump is a setback for shipping giants such as Cosco Shipping Holdings Co. and Ocean Network Express Holdings Ltd., which started the year strong as healthy trade volumes allowed the industry to boost rates. That optimism has now evaporated as the virus outbreak has forced shoppers to stay home, crimping retail sales in the biggest consumer markets.
Forward bookings for shipments from Asia to North America and Europe have slowed for April and into May, according to Ocean Network Express Chief Executive Officer Jeremy Nixon. Shipments of products from North and Latin America, Europe and Oceania to Asia are still strong, said Nixon, whose company is Japan’s largest container-shipping operator.
In addition to lower volumes, the industry has been hit by restrictions aimed at containing the outbreak. Ensuring that seafarers can board and transfer onto ships amid port curbs and canceled flights remains a major challenge, Poulsson said.
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