Brave new world for container shipping sector

THE container shipping industry has gone through phenomenal changes in the past couple of years. Key among the new trends is the development of ultra-large container ships (ULCS) and the rise in supply it has brought on.

The emergence of mega alliances is another key trend. With these two major changes, the industry is going through a wrenching change from which it is still suffering and will do so for some time to come according to industry leaders.

"Fundamentally, the industry's overall performance will be driven by the capacity demand-supply imbalances. We would expect 2015 to be a challenging year in that regard," said Neptune Orient Lines' container line unit APL president Kenneth Glenn. "The trend of launching mega-size container ships, slow steaming and larger shipping alliances will continue," he added. The hardest trade route has been the Asia-Europe trade where the megaships have been deployed. The oversupply of tonnage has combined with a stubbornly anaemic European economy to put continuous pressure on freight rates.