Whereas most industries shrunk before the 2008 global financial crisis, the international freight shipping industry witnessed tremendous year over year growth of 10 percent. Manufacturers were still shipping containers frequently to and from every corner of the globe. Freight forwarders were booking shipments of containers and break bulk for shippers. Those were some great times for the international shipping industry.
Fast-forward five years later to 2013. Instead of the usual double-digit year over year growth for container shipping, the growth rate is now around 5 percent, half of the growth rate 5 years ago. While the global financial crisis has now taken its toll on the freight shipping industry, there are certainly other factors contributing to the shrinking growth. Experts in the logistics industry point to the rising costs of fuel for ocean freight vessels, which has skyrocketed in recent years as a possible explanation. Another cause might be with overcapacity of space on shipping vessels. Some carriers are also saying that these expenses do not cover their shipping revenue, which is why many carriers might raise their ocean freight shipping rates if the industry does not improve soon.
The international freight industry must adapt to today’s market so that container shipping can grow. It may be difficult to return to the pre-2008 record numbers in the industry, but it is possible. If the industry can embrace new shipping technologies, and everyone including shippers can do their part, then the industry will have a chance to thrive and succeed like it once did.
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