Ocean importers continue to experience high demand for products in the aftermath of the 2020 worldwide commerce shutdown due to COVID‑19. The demand for import products joined with limited supply on ocean carriers will be a major factor in 2021.
Economic shutdowns decreased import volume for most of 2020. The resulting lower revenue for ocean carriers caused vessel alliances to opt for reduced (blank) sailings as a way to offset costs. The reduced capacity from blank sailings eventually collided with increased demand for space as the world’s economy started to replenish seriously depleted inventories. Add to that new demand for PPE, vaccines, and related equipment, and importers are challenged to move cargo rapidly. Ocean carriers are incapable of increasing supply on short notice fueled by sudden surges in demand. Blank sailings are expected to continue into 2021 until supply and demand have a chance to balance.
Meanwhile, the import shipping boom is adding much-needed revenue to the ocean liners’ coffers, depleted in recent years while their infrastructures suffered from cost cuts. Ocean liners may not be too eager to increase capacity any time soon. Even if the worldwide economy returns to normal in 2021, what incentive is there to return to excess supply and big deficits? Blank sailings may be a post-COVID-19 “new normal,” at least for the near future.
The industry has seen ebbs and flows in supply and demand over the years, but 2021 will offer a dynamic not seen before in shipping: Peak seasons will be replaced by peak years. In these circumstances, the NVO’s role becomes more valued and continues to offer importers ways to meet the challenges of space, equipment, and pricing concerns during a shipping boom.