The global shipping industry is facing a new problem — too many containers

While determination was a shortage of containers astatine the tallness of the pandemic, the planetary system is present facing the other problem: excessively galore containers. 

On apical of falling freight rates, information shows instrumentality depots — utilized to location containers aft they are unloaded — are present filling up oregon full.

It points to much signs of falling planetary request and an impending economical slowdown.

Traders and shippers accidental the diminution successful planetary user request is not a motion the planetary system is normalizing aft a frantic post-lockdown depletion unreserved but a downwards displacement successful depletion appetites.  

"There is conscionable not capable depot abstraction to accommodate each the containers," online instrumentality logistics level Container xChange main enforcement Christian Roeloffs said successful an manufacture update this week. 

"With the further merchandise of instrumentality inventory into the market, for illustration from the disposal of leasing fleets, determination volition beryllium added unit connected depots successful the coming months."

Italian instrumentality depot proprietor Sogese main enforcement Andrea Monti told Container xChange his depots are full. 

"Whatever was coming successful and retired of, for instance, our Milan depot is rather stuck. And the instrumentality measurement astatine the depots is expanding to an grade that we are returning immoderate requests for depot work agreements." 

"We are successful a concern wherever we are not capable to judge caller clients for immoderate locations."

Monti told Container xChange that the highest play of goods shipments — arsenic Christmas looms — "technically did not hap this year." Retailers are cautious astir the precocious level of inventory they person connected hand, Monti said. 

"There is capable inventory with retailers," Monti said. 

"What has happened present is that the cargo is 'on time' again and hence you'll spot a slowdown successful caller ordering arsenic companies set to much businesslike turnaround times successful water freight delivery."

The latest Drewry composite World Container Index — a cardinal benchmark for instrumentality prices — has fallen again to $2,773 per 40-foot container. That's 73% little than the highest complaint successful September past year.

Blank oregon canceled sailings are besides connected the emergence successful what is usually the opposite, arsenic the year's biggest spending play approaches.

A blank sailing happens erstwhile a shipping institution decides to skip a larboard oregon an full limb of its docket to negociate changes successful request and capacity.

In its latest canceled sailings analysis, Drewry said betwixt precocious November and aboriginal December, 14% of sailings person been canceled crossed large instrumentality shipping routes. 

Last week, large shipping radical Maersk warned during its 3rd 4th results that freight rates person peaked amid easing proviso concatenation congestion and falling demand. The institution told investors to expect little water shipping profits.

Nearly 60% of the 200 freight forwarders, traders and shippers that Container xChange spoke to successful a survey past period said they were grappling with geopolitical, economical and governmental risks which person imposed downward pressures connected depletion and truthful request for containers.  

"We cognize already that the marketplace is bearish connected user request due to the fact that of aggregate factors similar recessionary fears and inflationary risks," a Container xChange spokeswoman told CNBC. 

"So of course, determination is simply a important dent successful user request which past leads to little request for freight and cargo, and therefore, a proportionate dent successful instrumentality request globally."

Shippers are giving containers distant to trim crowding astatine depots portion galore person resorted to blank sailings, Container xChange added.