Even though we’re only a few months into the year, 2021 has already presented several challenges regarding international shipping and ocean freight. The effects of Coronavirus continue to ripple throughout the global economy, with the most recent major shift being the new United States stimulus package. According to the volumes of trade transported by SEKO US, there has been a massive surge in e-commerce spending via stimulus checks, and this increase has resulted in an explosion of trade container demand in many industries. As such, local and global logistics companies are struggling to keep up with such sudden rapid growth, especially since the industry observed a severe drop in international trade during the first half of 2020. Global trade has since improved over the latter half of 2020 and early 2021, with the majority of consumer spending creating a boom in Chinese exports. This relationship between US stimulus and Chinese goods further demonstrates the United States’ growing dependency on the Chinese market, as well as the importance of efficient containerized trade within the region.
However, while the international trade industry may be recovering at record rates, global carrier services continue to struggle with insatiable consumer demand. The sudden influx in spending has created multiple issues for international businesses including heavy ocean traffic, lack of available ports, and continued delays from regions in which COVID-19 still presents an intense danger to everyday workers. Trade infrastructures everywhere are feeling the effects of these issues, especially those shipping to and from the United States. Steel production, in particular, continues to be lower than the existing demand, creating a wave of shortages and price increases for drums and cans. This is a temporary issue, of course, though the shortage may last up to 6 months and will adversely affect the production of 55 gallon drums. Even the recent cargo ship that ran aground in the Suez Canal is yet another example of how international trade has been pushed to its absolute limit in order to meet increasing consumer demand over the last few months. Combined with the rising cost of shipping throughout the world, it appears as though 2021 will be a bumpy and unpredictable ride for globalized trade. Berje will continue to monitor international trade news and provide updates to affected products whenever possible.
Market Report - China - Consumer Demand - Coronavirus - COVID-19 - E-Commerce - EU - Global Trade - International Trade - Stimulus Checks - Suez Canal - Suez Canal Blockage - US Stimulus Package - USA - USEC