The bankruptcy of Hanjin Shipping and the dramatic reduction in the number of container carriers serving the US trades make headlines, but shippers who use NVOCCs to move their ocean freight have seen a steady increase in their options in recent years, and this important trend will continue in 2017.
In May 1999, when the Ocean Shipping Reform Act was implemented by the US Federal Maritime Commission, there were 2,386 NVOCCs authorized to operate in the US trades. Five years later, this grew to more than 3,000, and by June 2009, it grew to more than 4,200 NVOCCs. As of November 2016, there were 5,245 NVOCCs serving the US trades.
That number will increase again this year, and the volume of containers handled by NVOCCs will grow. Cargo owners who focus on identifying NVOCCs who have the the expertise to serve them will be rewarded with competitive freight rates and value-added services.
The US Shipping Act recognizes NVOCCs and grants them authority to purchase ocean transportation services from ocean carriers and resell these services to shippers. While some NVOCCs limit the scope of their services to simply reselling ocean freight, most combine this with other supply chain services to add value, including customs brokerage, motor carriage, air freight transportation, and specialized services.
Oversize cargo specialists who understand how to utilize flat rack and open top containers to ship cargo that traditionally moved in breakbulk vessels now operate successfully as NVOCCs. There is a clear trend toward NVOCCs leasing specialized equipment, including tank containers for the shipment of hazardous materials. NVOCCs specializing in cold storage and expertise in transporting perishable commodities in containers are thriving. Growth and profit can be found in these niches markets, as well as the opportunity for shippers to enjoy more service options.