At the end of June, OMNI (Overseas Moving Network International) held another of its World Series online events for its OMNI members.

The intention this time was to provide an update on container shipping as the industry begins to return to normal following the trauma of the pandemic years. The speakers were: Rob van Steensel, Commercial Director or the Overseas Shippers Association (OSA); Philip Damas, Head of Drewery Supply Chains Advisors; and Cameron Bowie, Managing Director of Hapag-Lloyd UK and Ireland.  The event was introduced by Chris Mackley, OMNI General Manager, and moderated by Philippa Robinson, OMNI President.

Philip Damas provided an analysis of the data surrounding shipping volumes and pricing. He explained that the market is now returning to pre-COVID rates in most areas.  Traffic volumes are expected to grow only marginally in 2023 but return to normal next year. Port operations are now back to normal. There remains, however, significant over-capacity in the market which will result in more cancelled sailings.  Transit times have also been extended due to slow sailing however they are now more reliable. He expected longer transit times to become the norm as carriers adjust to new CO₂ emissions regulations and taxes and try to reduce costs. Carriers will soon be required to explain how they expect to pass on the additional costs associated with greater sustainability.

Cameron Bowie confirmed Philip’s analysis.  He said that the over-capacity had been caused partly by the freeing-up of vessels as ports had become less congested and because of new vessels, ordered when demand was higher, being completed and delivered. He made the point that, although rates had fallen back to pre-COVID levels, the shipping lines’ costs had not, therefore profitability was being affected.  He said that it was not healthy for customers if rates remained too low for too long as inevitably services would be affected.

Hapag-Lloyd is currently considering, along with other lines, its approach to more sustainable operations, especially related to fuel choices.  Cameron said the decisions would depend largely on availability.  He added that it is important that choices provide real benefits and are not simply greenwashing. Meanwhile the company offers customers the option for shipments to be 100%, 50% or 25% emission free by purchasing bio-fuels and attaching that purchase to their shipment. Certification is provided.  He said Hapag-Lloyd will be carbon neutral by 2045. The company has also introduced GPS tracking on most containers allowing shippers to advise the location of each customer’s containers at any point in the journey.

Rob van Steensel looked at the issue from a customer’s perspective.  He said that year on year HHG shipment volumes have remained very stable. He challenged the shipping lines on their lack of reliability saying that less that 50% of vessels arrived on time.  Shipping lines had made high profits during the period of high rates and now the customers wanted pay- back. He also spoke about the lack of choice because of consolidation and alliances and blamed the congestion at ports specifically on over booking by shipping lines.  Most importantly, however, he challenged the lines to improve their customer service and have more customer-facing staff available to help solve problems when they occur. He accused the lines of treating HHG as a commodity, like anything else, while ignoring the emotional aspect associated with a household goods move.

There ensued a lively discussion designed to help further clarify the issue of container shipping for the OMNI members.  More OMNI World Series events are planned.