Current Capacity Issues

With the 2nd quarter of the fiscal year complete, and businesses are carefully reviewing the current state of their industries to make the right choices for the next fiscal quarter. In particular, the shipping industry had an interested 2nd fiscal quarter. There was major news concerning international cargo shipping that occurred in the past few weeks. A big story concerns a new study released by consulting firm AlixPartners. The study summarizes the numerous obstacles that are limiting the potential growth of the ocean freight carriers. These obstacles include the big looming issue of supply and demand in today’s shipping industry. Essentially, there are capacity issues today, especially with some ships having too much empty space at times. Another economic obstacle for shipping companies includes debt and competition in certain regions.

As we approach this next fiscal quarter, the study makes it clear that there are still some issues in the short-term that are impacting the ocean freight rates. The study is clear that trade routes are being changed recently, and NVOCCs will have to react to the changes. And the study suggests that there could be future changes.

The AlixPartners study also makes a recommendation to the shippers who depend on container shipping. Essentially, shippers should monitor the current economic situation, and perhaps turn to third-party resources for help. The resources from freight forwarders have helped companies navigate the waters of a troublesome shipping industry. Hopefully in this next fiscal quarter and beyond, the ocean shipping industry will make vast improvements.