Uncertainty in any link of the logistics chain has a cascading effect on the future and financial well-being of the entire shipping industry. Policy changes and the state of the global economy will see the need for continued adjustments amid competing demands on different sectors in 2012.
Since the Ideal X sailed from Port Newark over 50 years ago, vessel size has been increasing. The new capacity coming on line – most of it in the large post-Panamax class – will add downward pressure on rates as some carriers hope to gain market share. The rumors of potential mergers between carriers that were rampant in 2008 and 2009 have again resurfaced with increasing uncertainty. Landside, as more stringent driver hours of service rules come online, we can expect an increase in the cost of trucking. The result will likely be a twofold modification in the system.
First, look for a greater reliance on rail intermodal for international and 53-foot containers. Second, expect a possible boom for consumer-rich areas, as shippers look to reshuffle distribution networks and build new centers closer to the end-buyer to avoid higher inland transportation costs.
Ports across the nation are preparing to welcome the large post-Panamax vessels by deepening channels, removing navigational obstructions, and making landside investments in roadways and railways. These investments help protect commerce and jobs while generating economic activity.
In short, 2012 will again be a year of transformations for the shipping industry.