The global economy suffers from a record number of containers in warehouses. Amid falling freight ponds, container warehouses are overcrowded. This indicates a drop in global demand and will lead to an inevitable economic downturn,USM reports.
“There are not enough places in warehouses to accommodate all the containers. As a result of container stocks entering the market, there will be additional pressure on warehouses in the coming months,” says Christian Ruloffs, executive director of container logistics platform Container xChange.
he fall in global consumer demand is a sign of a decline in consumer appetites. For example, the peak of the season of deliveries of goods before Christmas this year did not take place. Retailers are cautious about their inventory, says Andrea Monti, executive director of Italy’s Sogese container depot.
To solve the problem of overcrowding in warehouses, large ports charge an additional fee for empty containers that stand in terminals for more than seven days. Drewry’s latest consolidated global container index — a key benchmark for container prices — fell again to $2773 per 40-foot container. This is 73% less than the peak figure of September last year.
From late November to early December, companies canceled 14% of all flights on major container shipping routes, according to Drewry’s latest analysis.
For example, Maersk freight rates peaked amid reduced congestion in the supply chain and falling demand. The company warned investors about a decrease in profits from sea transportation.
Almost 60% of the 200 freight forwarders, traders and shippers surveyed by Container xChange face geopolitical, economic and political risks that have put pressure on consumption and, as a result, on container demand.