Containers Lagged Ocean Shipping Gains in 2023, UN Report Finds
Global maritime trade rose 2.4% in 2023 to 12.3 billion tons. According to the Review of Maritime Transport 2024 released by the United Nations Trade and Development (UNCTAD), shipping volumes are forecasted to grow 2% in 2024, with annual increases averaging 2.4% expected through 2029. However, the report warned that high freight costs and geopolitical disruptions continue to challenge shipping’s long-term recovery.
Container trade grew by 0.3% in 2023 but could increase by 3.5% in 2024 if the supply chain remains stable. UNCTAD reported a record 250,000 port calls by container ships in the latter half of 2023, driven by trade growth and longer routes. It pointed out that Asia, which handles 63% of global container volumes, faced congestion while disruptions through key routes like the Suez and Panama canals have pushed up ton-miles by 4.2%.
Rerouting, port congestion, and rising operational costs have kept the pressure on freight rates. By mid-2024, the Shanghai Containerized Freight Index (SCFI) more than doubled from 2023 levels. If rate pressures remain elevated, UNCTAD said global consumer prices could rise 0.6% by 2025.
Major ports saw wait times double in 2023 due to record ship calls and rerouted vessels. However, technology like blockchain and AI helped Asian ports reduce delays and improve tracking and transshipment speeds. The global fleet expanded 3.4% in 2023 with 95% of the world’s new vessels produced by China, Japan, and South Korea.
Source: American Shipper
Delays and Congestion Hit South American Ports
Schedule disruptions on the North-South trade lane have resulted in port delays, which are spreading across South America’s East Coast. Vessels arriving late from the U.S. are causing delays for cargo leaving ports in Brazil, Argentina, and Uruguay. JOC analyst and CEO of Vespucci Maritime, Lars Jensen, previously warned that the ripple effects from the U.S. dock workers’ 3-day labor strike at U.S. East and Gulf Coast ports would continue through mid-November. He noted that the delays would impact South American exports after three to four weeks after the end of the ILA strike.
Meanwhile, Brazil’s recent port worker strike has disrupted port operations, adding to the challenges. Approximately 60,000 port workers across Brazil went on strike on 22 October for 12 hours to protest new labor laws, with 20,000 workers striking at Santos port.
These disruptions and congestion are driving up export shipping rates. Spot rates for cargo from East Coast South America to the U.S. Gulf Coast have jumped to $5,800 per FEU – over 250% higher than last October. In contrast, Southbound rates for U.S. Gulf Coast exports to South America East Coast is at $975 per FEU.
Source: Journal of Commerce
