Container xChange, an online container logistics platform, released the Container LogTech predictions report for 2023, which highlights important global trends that the shipping and supply chain industry will witness in 2023. Most of the experts surveyed foresee that inflation and recession will have a greater impact this year, and will be the biggest driver of disruptions.
Specifically, 88% of respondents fear that the biggest impeding factor for businesses in 2023 will be inflation and recessionary fears, followed by ‘implications of war’ (57%), ‘impact of COVID in China’ (53%) and ‘worker strikes’ (23%). The majority of respondents also predict that the container rates and contract rates will fall further in the year 2023.
“The overall outlook for the year 2023 remains gloomy. Europe is hit hard with all-time high inflation; China struggles to cope with the virus and the US continues to witness hinterland transportation challenges and labour unrest. Most of these challenges will stay in 2023. Consumer confidence will pick up, but it really depends on whether we witness more disruptions in the coming times,” said Christian Roeloffs, cofounder and CEO, of Container xChange, an online container logistics platform.
‘‘Due to inflation increasing, there’ll be more unrest in the labour market which will certainly lead to more strikes, specifically in Europe, the UK and North America. And as we have seen before, strikes result in slow operations within the port which can exacerbate supply issues,’’ said Aamir S. Mir, chief operating officer, Caspian Container Company SA as part of the interviews.
Talking of rates, the report further predicts that the Long-term shipping contract rates will see an uptick in 2023, though gradually. “Freight forwarders will employ a ‘wait and see’ approach before making any long-term air cargo capacity commitments particularly,” the report claims.
Trucking rates for both dry and reefer cargo will continue to drop in 2023. Freight tonnage will continue to contract as market conditions and volumes return to pre-pandemic numbers.
Experts also predict that worker strikes will rise in 2023. Labour dissatisfaction might grow in European and North American economies. In that case, it will cause disruptions in global supply chains, as the report highlights.
‘‘Two, almost three exceptional years for carriers are definitely coming to an end. They will have to adapt back to lower margins due to a different supply and demand balance. Many customers, forced into high-cost contracts during the up-cycle, will come for revenge in the down cycle. And regulatory pressures, following excessive profits might appear on top of that, be it through bodies like FMC, EU or China’s MOC, as they each review alliance exemptions, new taxation regulations, or precedence cases from several complaints raised by shippers at different institutions.’’ said Ruben Huber, Founder and Director, OceanX.
Source: Container xChange