Inside the Industry: le dinamiche dei flussi commerciali europei in importazione ed esportazione

There is no doubt the container shipping industry is becoming more concentrated and heading towards a scenario in which a small handful of dominant carriers can still dictate matters. But there is still healthy competition in most trades. The big wave of M&A involving major players is probably coming to an end, but to turn the industry into a highly concentrated environment will require more consolidation in 2018 and beyond.

All this signifies that as the container freight market becomes more competitive with fewer dominant players, customers will seek value for money via optimal logistics solutions. The global logistics chain has never been more interlocking and inter-dependent and there are trends emerging which will have a more fundamental long-term impact on the global container shipping market and logistics chain.

These trends are predicted to intensify this year and beyond as the global economy benefits from its strongest period of growth for a decade. Despite US recent issues on TTPI and trades agreement, the changing patterns will be most evident on the major trading lanes including Asia-Europe, Europe to the US and one of the most significant changes is the continuing growth of traffic from Asia through the southern gateway ports in the Mediterranean. With liftings from China, South East Asia and other parts of Asia expected to rise this year, the option of the southern European ports for cargo transiting into middle and northern Europe will become a viable alternative.

Growth in South East Asia has remained stable in 2017, but there is a shifting of cargo share within the region. Singapore continues to regain cargo lost to other ports around the region due to the shift in alliances. Port handling throughout Europe rose on average by a robust 5% in 2017 as a result of a similar growth level in traffic arriving from the Asian ports. Europe’s recovery was partially driven by the southern European ports with the gate ports of Mersin, Contship’s gateway terminal La Spezia, Genoa, Ambarli, Barcelona and Valencia showing strong improvement.

The Asia-Mediterranean trades are expected to show strong demand for Asian exports this year, a trend which was increasingly evident throughout 2017. Asia-Med volumes rose by 7.9%, and while the pace of growth slowed in the fourth quarter, the final reading for 2017 was expected to come in at 5.4%. In the last 10 years – therefore since the global financial crisis – the Asia-Med haul market has jumped by 30%, compared with just 10% in the adjacent Asia-North European trade.

The real test will be how shipping lines deploy capacity post the Lunar New Year, in mid-February. With the demand growth softening slightly the Chinese holiday period provides an opportunity for the lines to reset deployment in the months leading up to the peak season. While the supply side pressures continue with new containerships coming on stream in Q1 and Q2, the idle capacity remains low by recent historical standards, at around 2% of the global fleet.

Most analysts agree that despite the uncertainty on the supply side the shifting trade patterns we have seen in 2017 will continue in the Year of the Dog as Asian shippers and others continue to seek alternative routing patterns for their cargo into Europe.

This article is part of CS WINdow, Broström Tankers AB's quarterly newsletter, featuring insights on the global supply chain, with a focus on European intermodal logistics. You can subscribe to learn more: