The coming year is an election year in the United States. Elections historically have had some global impact and headline-making capabilities with respect to U.S. “issues” when it comes to foreign policy and international trade. Between the economic crisis in Europe and the uncertainty that will come with the U.S. elections, the world economies will continue their slow pace of retrenchment.
This is an important backdrop for what I believe could be another troubled year for the world’s top ocean carriers. Many of these carriers are losing large amounts of money again, which will result in a reduction of capacity in numerous trade lanes and the corresponding attempts to increase prices. We also should see a consolidation of ocean carriers, with some of the larger carriers with losses being merged or acquired by others.
Because it’s an election year, and because of the way the pricing will adjust in certain trade lanes, I also believe we will see a round of investigations and negativity with respect to ocean carrier price-fixing and antitrust activity. I’m not saying anyone is guilty — we all know these things don’t really happen, right? — it stands to reason that in a down economy and an election year the politicians will do anything to make headlines and keep price increases at a minimum.