Coronavirus pandemic triggers shipping container crisis

Anyone who needs to ship something big — or a great deal of something small — rents what is known as an intermodal container for the purpose. But that’s not an easy task at the moment — there simply aren’t enough transport boxes available. Buying a container isn’t easy either.  

The German daily newspaper Frankfurter Allgemeine Zeitung recently reported that there are only two companies in the world that build and sell shipping containers — both are based in China.

Anyone in Europe seeking to buy one can only get it secondhand: Even new containers are first loaded with goods in China and used for one shipment before they can be taken possession of here.

Why are shipping prices skyrocketing?

The costs of rent and shipment have also risen. Before 2020, transporting a standard 40-foot (12-meter) container on a ship sailing from a Chinese port cost about $1,000 (€840) — currently, one has to pay up to $10,000.

Rising prices are always a sign of imbalance. In this case, it is a sign of increasing demand (for containers or shipping space) with stagnating or even declining supply.

But there is also a shortage of ship space at the moment. “There are hardly any reserve ships left,” Rolf Habben Jansen, CEO of the logistics firm Hapag-Lloyd, told the German weekly magazine Der Spiegel.

Many shipowners invested little in their fleets in recent years, he said, “because they have not earned the cost of capital over many years. Nobody expected the high demand for shipping transport due to the pandemic. There will not be more ships in the short term.”

Global problems

Despite the short term dearth, the problem is not only about insufficient numbers of new boxes. Containers are almost never used for one-time transport and are instead part of a global system.

As soon as a container loaded with Chinese toys, for instance, has been unloaded at a European port, it will be filled with new goods and may then carry German machine parts to Asia or North America.

But for a year now, it’s been difficult to maintain the global timetables that regulate intercontinental shipping, as the COVID-19 pandemic, which began in early 2020, has continued to fundamentally disrupt global trade.

Post time: Jun-15-2021