If any shipping entity has over extended itself and is not durable enough to weather hard times, particularly after a sustained period of positive trading and earnings, then why should government step in and support it? Is there a commercial logic which justifies this sort of action? Do extraordinary times require extraordinary measures of this sort?<\/p>\n
Opinion is divided. Competitors of lines such as CSAV, CMA-CGM and Hapag Lloyd, where the helping hand of government has been introduced, decry the idea of government assistance, in whatever shape or form, suggesting that this interferes with natural market forces taking place and in particular a further contraction in the number of players active in the container shipping sector. In effect, the suggestion is that these helping hands suspend reality and by so doing promote sector inefficiencies. Certainly, this is the view of the world\u2019s number one container line, Maersk.<\/p>\n
On the other hand, the view is taken by government and others that this latest economic crisis stole up on us so fast and with such devastating results that the shipping sector deserves support in order to maintain key architecture through which international trade takes place. If the truth be told, however, such a view is likely to be underpinned by national considerations. Who wants to see \u2018our national carrier\u2019 disappear?<\/p>\n
There is, according to some, help at hand in the shape of a trade uplift, the economic engine of the world getting back in gear again. At the beginning of February, the Paris-based consultancy Alphaliner, a major source of information on the container sector, proffered the view that volumes and rates have been rising recently and the increases \u201cappear to be resilient\u201d. It highlighted growing “optimism among operators with a stronger-than-expected surge in demand in the pre-lunar new year period to mid-February\u201d.<\/p>\n
Despite these green shoots, however, Alphaliner acknowledges that the idle fleet still remains high at 10.4% of the total cellular fleet with a significant number of new deliveries expected in 2010. The level of deliveries this in 2010 is expected to be higher than the growth seen in 2009. Deliveries in January 2010 alone have reached 30 ships for 133,000 teu – the highest level of deliveries recorded.<\/p>\n
This view of patchy market recovery is also reflected in the comments of various shipowners and affiliated interests who believe that container freight rates that have risen off the back of a surge in demand and will fall back later in the year as exceptional demand patterns normalise. Eivind Kolding, chief executive, Maersk Line, offers the view that it will not be until 2013 that the container market will reach a healthy balance between supply and demand. Another factor that seems to point to the distinct possibility of at least one or two big container shipping line failures.<\/p>\n
Expect also significant internal action by lines aimed at strengthening their respective positions. NYK Lines has just announced that it will halve the fleet of its self-owned container vessels to reduce costs and improve profitability.<\/p>\n
It is manifestly clear that container market health remains vulnerable in 2010, even though this year container volumes could grow by as much as 3%-8%. Against this, the reality has to be factored in that container volumes in 2009 fell by around 10%, the first year of reduced volume since containerisation became a global activity in the 1970s.<\/p>\n","protected":false},"excerpt":{"rendered":"
Is it a double edged sword allowing market forces not to prevail?<\/p>\n","protected":false},"author":8,"featured_media":7925,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[68],"tags":[],"sponsor":[],"class_list":["post-7924","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-post-script"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/7924","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/comments?post=7924"}],"version-history":[{"count":1,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/7924\/revisions"}],"predecessor-version":[{"id":7926,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/7924\/revisions\/7926"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/media\/7925"}],"wp:attachment":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/media?parent=7924"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/categories?post=7924"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/tags?post=7924"},{"taxonomy":"sponsor","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/sponsor?post=7924"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}