Sunday , 19 May 2019
Latest News
UNCTAD’s recently released Review of Maritime Transport 2013 (RMT) reports that driven by rising domestic demand in China and by increased intra-Asian and South–South trade, international seaborne trade performed relatively well in 2012, with volumes increasing by 4.3%, reaching 9.2bn tons for the first time ever.

UNCTAD Reviews Maritime Transport

World container port throughput also increased by an estimated 3% in 2012, to 601.8m teu in 2012. This growth was reflected in a strong port-finance sector as investors looked to infrastructure to provide long-term stable returns.

The 2012 increase in seaborne trade did not do much to boost the maritime shipping industry’s profitability, however, despite the fact that last year, for the first time in over a decade, the number of ships entering into service declined from the total of the previous year. The largest cycle of ship building in history – the cargo capacity of the world fleet more than doubled between 2001 and January 2013 – finally began to slow, but even with fewer new ships, world tonnage capacity continued to climb in 2012, that meant the prevailing oversupply of shipping capacity continued through 2012.

The steady delivery of new vessels into an already oversupplied market, coupled with the weak global economy, kept shipping rates under heavy pressure. The low freight rates that prevailed in 2012 reduced carriers’ earnings close to, and even below operating costs, especially when bunker oil prices remained both high and volatile. Carriers applied various strategies to remedy the situation, in particular by taking steps to reduce fuel consumption.

Among other challenges facing the industry are energy security and costs, and related issues of climate change and environmental sustainability.

But the RMT stresses that new opportunities are emerging in connection with a number of trends. These include growing regional seaborne trade and South–South cooperation, structural change in the world energy map and consequent ripple effects on tanker trade as well as the anticipated expansion/opening of new sea routes through the arctic and through the widened Panama Canal. The improved canal is expected to open in 2015.

A long-term trend towards larger cargo vessels continued in 2012 and 2013, the Review reports. Also continuing was a trend towards fewer liner companies serving each country.

Based on UNCTAD’s Liner Shipping Connectivity Index (LSCI), which now has compiled data for 10 years, the average number of carriers per country has decreased by 27% over the past decade, from 22 in 2004 to 16 in early 2013. This reduction in choice among shippers poses challenges, especially for smaller developing countries, which are confronted with potentially oligopolistic markets.