Record volumes continue, driving interest in digitizing or converting paper records to digital to streamline processes.
Global lockdowns are prompting more organizations to consider developing regional supply chains, either to replace or complement global ones. Discussions about relocation, which would also shorten supply chains, are also picking up.
BALANCING SUPPLY AND DEMAND
Carriers and ports experienced massive bottlenecks, while freight rates rose to record highs. In the future, carriers are likely to continue to cancel trips to keep supply and demand more balanced.
Capacity reductions were unusual. Large transportation companies have traditionally chased revenue at all costs. One operator would reintroduce capacity, with the goal of increasing market share. Even so, carriers held firm and rates went up.
Increasing rates may also lead the business community to reconsider discussion agreements with carriers. More frequent negotiations with carriers and freight forwarders could be a new normal.
Index-based pricing is also gaining wider adoption. Carriers and carriers have long flirted with the idea, but were hampered by a lack of fair rates on which to base their contracts. Today, more indexes are available for carriers to use to manage and cover
TECHNOLOGY BECOMES KEY
Technology and digitization will be essential for the success of the maritime industry.
Shippers will be able to track their products from loading at origin to the arrival of a ship. Operators in ports, terminals, shipping companies and warehouses will be able to plan more precisely, creating widespread efficiencies.
Nevertheless, before the maritime industry can take advantage of technology, it needs standards that are system independent and neutral.
The Digital Container Shipping Association, along with its shipper members, is working with industry stakeholders, as well as industry and intergovernmental organizations, to establish digital standards for various initiatives that are top priorities in the upcoming three to five years.
CONTINUOUS FOCUS ON SUSTAINABILITY
Using liquefied natural gas (LNG) to fuel ships could reduce carbon emissions by 15-30%, while reducing sulfur dioxide and particulates by more than 90%, according to Hapag-Lloyd.
The carrier is the first to convert a large container ship to run on LNG or low-sulfur fuel oil.
The upheaval that occurred during 2020 shows no signs of stopping and could produce a maritime industry that looks very different in a few years. Organizations that accelerate digitization efforts will gain a competitive advantage, similar to what happened in retail and other industries.
Source: InboundLogistics