Global shipping trends: What to expect in 2020
Recapping 2019’s top global shipping disruptors
Special to the AJOT Mike Short, president of global forwarding, C.H. Robinson
Now that the fireworks are over and New Year’s resolutions are set, it’s time to prepare for global shipping in 2020. And that means looking at ongoing trends and changing regulations. One thing’s for sure, freight forwarding never has a dull moment.
Recapping 2019’s top global shipping disruptors
Before we jump into expectations for this year, let’s set the stage by looking at some of the top events in 2019 that may have affected global shipping strategies around the world.
Geopolitical uncertainties
From the ongoing Brexit discussion to the China-U.S. trade war and the trade conflict between Japan and Korea, these and other disruptions caused serious challenges to the transportation industry.
Preparation for International Maritime Organization (IMO) 2020
While the latest revisions didn’t go into effect until January 1, 2020, preparation for the changing IMO requirements was well underway in 2019. The requirement to reduce sulphur oxide emissions from 3.5% to 0.5% was a drastic change that will likely continue to affect shipping costs and capacity availability.
E-commerce expectations
With the growth of ecommerce and high-tech products flooding our markets, air freight is a go-to mode of transportation for many shippers—any time of year.
To best understand how these and other mode-specific changes will affect your 2020 shipping year, let’s break them down by service.
Ocean service in 2020
In the past, ocean shipping followed the basic law of supply and demand. When demand increased, rates went up. When demand decreased, rates dropped. This often occurred regardless of carrier profitability. But that is changing, which could reshape expectations for 2020.
Carriers controlling capacity
Today’s ocean carriers are quick to withdraw capacity when demand changes. By adjusting the amount of equipment available, ocean carriers are better able to ensure demand remains tight enough to protect their profits. This is a successful technique because there are fewer ocean carriers than in the past, allowing for a quicker reaction when supply and demand shifts.
Article Reference: American Journal of Transportation
About Author: Mike Short is the President of Global Forwarding at C.H. Robinson, he leads a team that is motivated, efficient and extremely collaborative. He has more than 20 years of experience in the supply chain industry.
About Axe Bpo: Axe Bpo is a Business Process Outsourcing company serving Freight Forwarding and Logistics companies across Continental Europe & USA. For over 15 years, we are successfully serving clients in Spain, Sweden, France, Belgium, Netherlands, UK, etc., who are well-known entities in the Forwarding / Consolidation industry. Our aim is to deliver substantial operational economy and efficiency, apart from helping our clients extend excellent customer service. We constantly strive to adopt and adapt appropriate technology, multilingual capabilities to quicken our process delivery matching expected Turn Around Time and Price parities. This has ensured that our clients’ trust in us and most customer engagements have spanned 10+ years.
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