Global Shipping Container Shortage Has Ripple Effects on International Trade
The knock-on effects of the pandemic that led to terminal shutdowns and halted economic activity created some unforeseen consequences in the freight industry. A global shipping container shortage caused by workforce disruptions, port closures, and the shutdown of factories instigated a perfect storm that is still plaguing the industry today.
A blockage in the Suez Canal isn’t helping the current situation considering global trade is delicately dependent on every part of the process operating efficiently. About 12% of all global freight operations (and thereby trade) travels through this route connecting the Indian Ocean with the Mediterranean seas. All these little events are contributing to what’s becoming a major problem in shipping, as a global shipping container shortage now exists, and there’s no clear solution on the horizon.
What Created the Shipping Container Shortage?
Exports and imports are the lifeblood of a country’s GDP, making the container shortage a global crisis. Various causes, compounded over time, created the current challenges for a supply chain that stretches around the world. As of January 2020, global trade dropped by considerable amounts before surging in the months leading up to 2021.
The pandemic’s disruptions had planners guessing, and containers used for imports didn’t necessarily have export orders available from usual destinations. Those left behind created large stockpiles in markets as transporting empty containers have zero economic benefits. When countries started implementing individual controls to deal with the pandemic, supply chains broke down once there were no reverse cycles available to shipping companies.
How Can Companies Solve the Global Shipping Container Shortage?
There is no easy solution to the current shipping container shortage, and the longer it exists, the more expensive products will become. Everyone from manufacturers, distributors, to downstream industries is currently at risk. In response to the global shortage, some freight organizations are now providing container pre-booking services to help manage the crisis.
Port congestion, reduced labor availability, fewer operating vessels, and significant changes in consumer habits lead to the current problems. Operators are working together to solve the immediate challenges and help global economies recover. Improved economic activity seems to be everyone’s goal, as this will reestablish the reverse-logistics that make the process economically viable.
Palmetto Industries as Your Bulk Container and Shipping Partner
For most manufacturers, the safe and efficient transport of goods remains a primary goal. Palmetto Industries can assist with a range of standard and customized solutions to support any part of your supply chain or material handling operations. Global trade will return to normal levels eventually, and Palmetto Industries is ready to help you prepare to deal with any demand.