After an estimated 126% rise in container shipping rates this year, 2022 should again see high rates and big profits for carriers. So say the maritime analysts at Drewry, in their most recent Container Insights blog post the first week of October.

Supply Chain Digest Says...   Drewry notes the fat bottom lines may increase the level of government scrutiny across the globe as carriers profit while service levels headed south, for a variety of reasons.     What do you say?   Click here to send us your comments       Click here to see reader feedback

Container shippers won’t see much relief until 2023, Drewry writes, when a huge number of scheduled new ship deliveries may once again put the market in a state of overcapacity common for many years before the pandemic.

Container volumes of course have soared in 2021, and Drewry forecasts full year containers shipped (imports and exports) will be 8.2%, far above the overall growth in global trade in the year. And that strong growth isn’t just reflective of weak 2020 numbers – Drewry says container volumes worldwide should be up 7.2% versus 2019 totals.

Drewy forecasts 5.2% growth in 2022 over the robust 2021 numbers, which should well exceed capacity growth in the year, leaving carriers with all the clout again.

However, Drewry notes that “that the story will flip from 2023 onwards as the recent frenzy of orders start to be delivered,” in some good news for shippers.

But carriers won’t care too much about down rates in 2023 after “three years of previously unthinkable and outlandish profits,” Drewry notes.

Following the average rate hike for combined contract and spot rates this year of 126%, in 2022 Drewry sees spot rates declining, but that there will be a significant increase in contract pricing. In total, that will lead to an increase in average global pricing of about 6%.

And container carriers have of course been raking in record profits. Drewry says EBIT (earnings before interest and taxes) across carriers topped $39.2 billion in Q2 of 2021, an almost eleven-fold improvement from $3.6 billion profit in the same quarter a year ago.

It adds that increases in input costs, such as charter rates and bunker prices, had little impact.

“Every carrier that we track increased their margins compared to 1Q21, some beyond 50%,” Drewry says.

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However, Drewry notes the fat bottom lines may increase the level of government scrutiny across the globe as carriers profit while service levels headed south, for a variety of reasons.

“With regulators breathing down their necks for evidence of unethical activity, lines are on the defensive and recent moves by some to cease further spot rate increases need to be viewed through the prism of a PR war,” Drewry notes.

It concludes the blog by stating that “Carriers will continue to make splash investments over the short and medium-term, because they can, and because they are being closely scrutinized.”

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