Will maritime congestion continue until 2023?

More and more forecasts indicate that the problem of poor shipping will continue this year. Currently, container freight rates, ship leasing costs and port congestion are still at or close to historical highs, and the industry's expectations for the return to normal in the shipping market have been repeatedly postponed. Some institutions even believe that the problem of shipping congestion will continue until 2023.

In this case, in order to ensure shipping capacity, shipowners are also willing to pay high prices to lease and purchase ships. In 2021, the number of container ship transactions reached an all-time high. According to a report by shipping consulting firm Alphaliner, the transaction volume of container ships reached 572 last year, equivalent to 1.97 million TEUs.

At the same time, major liner companies have started ordering new ships since the fourth quarter of 2020. Industry analyst Jorgen Lian said that these ordered new ships will be delivered in 2023 and 2024, when a large number of new fleets will enter the market.

"By then, the throughput of global ports will increase by 15%. If the congestion problem is not alleviated before then, the ports will face greater pressure," said Jorgen Lian.

In fact, serious congestion has occurred in US ports since the second half of 2021. Entering 2022, the number of ships waiting for berths near the ports of Los Angeles and Long Beach has reached a stable level, with an average of 101 ships queuing up every day since the beginning of January, and on January 9, the number of waiting ships reached 109.

What exactly causes shipping congestion and supply chain problems? There is a theory that the current supply chain congestion problem is driven by the continued high demand in the European and American markets. If it is indeed caused by rising demand, then shipping and supply chain congestion may continue until 2023.

ZIM is one of the supporters of this view. ZIM's CFO believes that the overcapacity threat of new ships delivered in 2023 is small, partly due to the congestion of land transportation, especially in the United States, which will partially offset the overcapacity and shipping capacity brought about by the growth of the fleet.

However, there is also a theory that the problem is due to problems in some links of the supply chain. As long as these problem links can be found and solved, the current supply chain problems can be solved.

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