Container shipping demand has surged in the back half of 2020 as companies catch up on restocking and consumer spending rose through the summer.
Shippers have thus had to suffer the dual blow of tight capacity and high spot rates. Carriers have deployed a record amount of capacity, but it has still not been enough to keep up with demand. Shippers have described procuring freight as a “nightmare.” Demand has driven costs up not only on the spot market, but also for equipment like containers and chassis.
“The pace and magnitude of the trade recovery have generally exceeded our customers’ expectations, and virtually all of the major shipping lines have needed to add significant container capacity,” Brian Sondey, CEO of Triton International, the world’s largest container leasing company, said in a statement in a recent earnings release.
But just how long these volume records will last is unclear. Movements in the macroeconomy suggest consumer spending might not be able to keep volume afloat much longer, Lars Jensen, the head of consulting at Sea-Intelligence, said on LinkedIn. Jensen cited a forecast from The Conference Board, a non-government nonprofit, showing that high unemployment will undercut the consumer spending that helped to spur growth through the summer.