Is It Smooth
Sailing and Clear
Skies for Ocean
and Air Cargo?
These competitive modes have at least two things in common: Each took a drubbing in the past year or so,
and each is cautiously optimistic that things are looking up.
ere in the first quarter of 2010, it is
the fervent hope of those in
ocean and air freight transportation that we’ve put the worst
behind us. It’s spring, after all,
Take the ocean carrier and ports business first. The lines had a disastrous 2009 by
anyone’s reckoning. The container shipping industry alone lost perhaps $20bn, and
that’s left a number of lines reeling. Quite a
few have issued shares and other instruments to raise needed capital, ‘K’ Line being
one of the latest to do so. Others have
turned to their governments for either
bailouts or other relief. Hapag-Lloyd
H
secured a $1bn in loan guarantees from the
German government, for example. Happily
for it, cargo volume seems to be up and
management is optimistic that government
backing won’t be needed any longer. Government intervention, incidentally, has
been a nettlesome subject in the industry as
the degree of state help often turns on the
amount of a government’s stake in a line.
Evidently, some privately held carriers have
felt disadvantaged.
In any event, many in the industry are feeling a bit more confident these days. For
instance, the Westbound Transpacific Stabilization Agreement, which numbers Hapag-Lloyd, ‘K’ Line, APL, COSCO, Evergreen,
Hanjin, Hyundai, Yang Ming, OOCL and NYK
Line among its members, sees growth for all
types of westbound cargo rising 4.1 percent
this year and just missing 7 percent in 2011.
That would be a terrific boost for a
beleaguered industry, but in the meantime
a number of decisions, some quite painful,
need to be made. For instance, rates are
being raised—seemingly in a continual
upward spiral—orders for new ships are
being canceled where possible, and others
are being furloughed.
