7 shipping trends in 2018

According to UNCTAD, there are 7 shipping trends in 2018 that redefine the maritime transport industry´s landscape and will be the main drives of change within the sector. These bring challenges and opportunities that require constant monitoring enable effective and progressive regulation:

1. 1. On the demand side, the uncertainty derived from geopolitical, economic and trade risks as well as structural changes will have a negative impact on maritime transport. The immediate concern is internal policies that are born from protectionist or nationalist sentiments, which can affect global economic growth and restrict trade flows changing their patterns.
   2. Digitalization, e-commerce and the implementation of the Belt and Road initiative. These will have great implications in maritime industry and commerce.
   3. On the supply side, exaggeratedly optimistic lines competing for market share could order excessive new capacity (new construction of containerized vessels) which would result in the worsening of maritime market conditions. Consequently, it would affect the balance of supply and demand with strong repercussions on the level of freight, volatility and transport costs and benefits.
   4. The consolidation of maritime lines through mergers and acquisitions has increased in recent years in response to low levels of demand and an oversupply of capacity dominated by mega container ships. This involvement could increase the decision-making power of large container lines and their impact on smaller ship owners. Competition authorities and regulators, like other entities such as UNCTAD, need to be vigilant about the implications for industry, ports, global trade and to establish policies that address these implications. Tasks include the monitoring and analysis of the effects of cooperation and merger agreements not only on the freight levels but also on the frequency, efficiency, reliability, and quality of the service. In essence, ensure transparency, fair competition and the good health of the industry.
   5. The restructuring of the alliances and the dispatch of larger ships also redefine the relationship between the ports and the container lines. Competition authorities and maritime regulators must also analyze the impact of market concentration and alliances in light of the relationship between ports and shipowners. The areas of interest include the selection of arrival ports, the configuration of service networks, the distribution of costs and benefits between lines and ports and the approach to port concessions.
   6. The value of maritime transport cannot be determined by the scale only. The sector’s ability to leverage itself in advances of relevant technology is increasingly important.
   7. Efforts to reduce the carbon footprint and improve environmental performance in maritime transport are a priority on the international agenda. In April 2018, the IMO adopted the initial strategy to reduce greenhouse gas emissions by at least 50% by 2050. As for environmental pollution, the sulfur limit on the content of the fuel is established at 0,05% mandatory as of January 2020. For this, the shipowners and operators consider the adoption of strategies such as scrubbers, LNG or low sulfur fuels.

However, most of these trends precede the industry’s resounding changes. IMO will proceed to regulate what is its responsibility and then to support the states to ratify and endorse this regulation as new legislation of each state. Likewise, in matters of technology, states will also be able to decide whether to legitimize it or to enter the power struggle with the industry that moves towards a more efficient, aware and global business.