After Covid’s massive demand shock, the culprit now is too much supply.
They’ll likely drift back into the red this quarter as the rates they charge fall below costs and look to stay there for the foreseeable future.īooms-turned-busts have been more abrupt and sensational, but rarely has an established industry so tied to the global economy lurched from historic profits to below break-even levels more directly than the shipping lines that move 80% of the world’s merchandise trade have this year. The biggest carriers posted net income totaling $364 billion in 20, according to figures compiled by industry veteran John McCown, after a decade of scant profits. That’s because the container shipping industry, cast as the Grinch that spoiled Christmas over the past two years with record-high freight rates and slow deliveries, is returning to its pre-pandemic place in the corporate world: perennial underachiever Charlie Brown.
Consumers gearing up to buy the latest imported appliances, clothes or electronic gadgets this holiday season might want to spare a thought for the companies that will struggle to make money for the next few years hauling products across the ocean.
