Tag: containers

JANUARY 2017, MARITIME REVIEW, TRENDS FOR 2017

conjoncture 2017

INTRODUCTION

As 2016, three trends will describe maritime industry in 2017: 1-an increased volatility of demand 2- a sustained but uneven global recovery 3- a restructuring of the maritime supply.  This text presents an analysis of these trends.

1- An increased volatility of demand

1.1 New external factors

Variability of the risk makes demand for transport less predictable. In 2016, several factors triggered this instability, including fluctuations of exchange rates, slowdown of Chinese economy, lower oil prices and difficulties of the European economy.

In 2017, recovering of American and European economies is well engaged. Despite a slight slowdown of the GDP of the United States in the last quarter of 2016, one can anticipate a still dominant position of the U.S. dollar will continue in 2017.  The impact of a strong U.S. dollar boost U.S. imports.

In return, other external event to the industry are related to international political situation. The intention of Donald Trump to review several agreements of free-trade (NAFTA and the transpacific Partnership), the vote on the Brexit inducing the exit of Great Britain of the European Union are some examples.  The rise of protectionism could have the effect of undermining the global economic recovery.

In the sector of maritime transport, two important events occurred in 2016, the bankruptcy of Hanjin Shipping and the opening of the new Panama Canal.

Some believe that Hanjin Shipping’s bankrupcy it is precursor to a major crisis (Gerry Wang, CEO de Seaspan) in the industry. Hanjin’s situation is not unique and other maritime companies are also in difficulty. Because, recessions are the result of a chain process, if other bankruptcies were to happen, the effects could be devastating on the financial institutions, the clients or suppliers and shippers. It could even slowdown entire world economic activity.

In the case of the … Lire la suite

JULY 2016 – THE CONDITIONS FOR SUCCESS OF THE NEW PANAMA CANAL

The Panama canal

Introduction

On June 26, the Government of Panama announced, with great fanfare, the completion of the expansion of the Panama canal. It was a historic event for this small Central America country. The crowd was awaiting the traverse of the first container ship, a Cosco ship from Asia, measuring 300 meters long, 48.25 metres wide and capable of carrying 9 500 containers (TEUS): two times the maximum capacity of the old locks.

62 international delegations were invited to listen to the speech by President Juan Carlos Varela Rodríguez. The event reflected the project: the Panama canal plays a strategic role in international maritime transport. For the population of Panama, expectations are high, since this project will hopefully revive the country’s economy and restore the market share lost over time to the Suez canal.

Although the promotional campaign of the Panamanian Government is fully justified, studies on the impact of the project leave many elements imprecise and uncertain. The complexity of the world situation and the state of international trade which has evolved in recent years may explain it.

According to research conducted jointly by The Boston Consulting Group and C.H. Robinson, as much as 10 percent of container traffic between East Asia and the U.S. could shift from West Coast ports to East Coast ports by the year 2020. Other research also suggests that the expansion of the canal will impact the trade of bulk, especially between Asia and America.

However, several market conditions are necessary for the achievement of these forecasts. The following text presents an analysis of these conditions.

The role of Panama

A strategic location

The Panama canal plays a strategic and undeniable role in global transportation. It significantly reduces the distance required for the transport of goods. Transportation costs are substantially reduced, as are the price … Lire la suite