Is the Shipping Industry on the collapse?


  • Container shipping companies are on the brink of collapse due to COVID-19 restrictions.
  • Cargoes are stranded on ships for extended periods and fewer outbound charges.
  • Ship carriers are cutting costs by taking the Cape of Good Hope rather than the Suez Canal.
The economic decline in 2008 is considered by many economists to have been the worst financial crisis since the Great Depression to hit not just the real estate market but also the shipping industry.

The maritime industry found itself at the center of a global financial crisis, while the supply of ships exceeded its demand. Ship owners and charterers immediately imposed a buying freeze to control the capacity in order to resuscitate plunging freight rates and survive from the shrinking cargo volumes.

The COVID-19 pandemic is wreaking havoc on global shipping, which could probably initiate another crisis. To prevent the spread of the virus, a number of ports and shipping companies have implemented measures, which is causing severe disruptions within the industry. 

In addition, the strict containment guidelines imposed by the governments around the world have resulted in substantially lower global economic growth and eventually, lower demand for the movement of goods.

Preventative measures have already had a direct impact on shipping and, as the virus continues to spread, global demand will decline further as constraints on markets vital to the industry such as manufacturing and industrial activity become tighter. 

The additional pressures caused by the coronavirus outbreak are likely to exacerbate existing issues, which might hit the financial performance of global shipping companies, which could send the industry into a period of uncertainty for years to come.

How long will it take for the industry to revive from this potential collapse is something only the shipping experts can predict!


Comments

  1. Excellent read Sanil. Please also write about the struggle of seafarers stranded for sign off

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  2. Excellent read. Keep up the good work!

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  3. Extremely uncertain times ahead, nearly every industry is as badly hit barring few....the government should intervene and help curb some of the policies that restricts movement and make it more industry favorable.....they got to keep the economy alive, else lost of jobs or no jobs will further damper the growth

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  4. very informative. I love your writing style❤ keep it up��

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  5. Write about situation of seafarers beta

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