Global Shipping Container Industry Update: 6 Months Into COVID-19

September 18, 2020

With the uncertainty that 2020 has brought as a result of COVID-19, we felt it was a good time to reflect and project on what is happening in the shipping container industry globally.

Looking Back

The last six months have been incredibly turbulent for large parts of the global economy, but the logistics industry in which the humble shipping container is still central, has managed to continue steadily through the COVID-19 pandemic, albeit with some peaks and troughs.

The roller coaster of a year was impacted largely by the below:

  • An initial shutdown of China resulted in large blank sailings and as such, an oversupply of shipping containers in China.
  • The consecutive shutdown of further economies globally meant huge inefficiencies in logistics, resulting in shipping container shortages.
  • A reduction in global trade resulting in lines cutting back on sailings and capacity, leaning towards an ease of container supply.
  • Panicked PPE shipments from China, combined with Christmas shipments resulting in a strong 40ft HC demand market. With the above playing out, the container prices have been surprisingly fairly stable, with marginal reductions in the USD price earlier in the year.
Covid 19 Impact

Current Situation

There has, however, been an unprecedented increase in shipping container prices over the last few weeks in China. Prices have increased as much as 25%, soaring to over $2,500 for a used 40ft HC in some Chinese ports. Not only have prices increased, but the availability has drastically reduced, with month on month reductions in idle stock at the factories dropping by 17%.

This has been driven by the culmination of the above “roller coaster” factors, which are now having an impact, as well as impending USA v China trade war tariffs, which are said to be causing large amounts of “pre-tariff trade”.

Looking Forward