Faced with a complex wave of interconnected challenges, ocean carriers keep shipments on course by refining schedules, enhancing fleets, adding new technology tools, and introducing greener fuels. Smart Sailing: Maritime Success Strategies
by Merrill Douglas
“O ur industry is facing a polycrisis environment,” says Trine Nielsen, vice president, global head of ocean freight at Flexport, a San Francisco- based global freight forwarder and non-vessel operating common carrier (NVOCC). Certainly, the challenges in ocean transportation flow from many directions these days. Take the attacks by Yemen’s Houthi rebels on commercial shipping in the Red Sea. The situation has prompted shipping lines to forsake the route through the Suez Canal, detouring vessels in the Asia-Europe trade around South Africa. “There is no additional capacity to deploy to the Cape of Good Hope routing, absorbing all normally planned buffer capacity,” says Ursula Wallace, director, ocean product, North America at SEKO, a forwarder and NVOCC in Schaumburg, Illinois. “Shipping lines try their best to ensure consistent service, but without having additional ships to deploy, schedules will continue to be impacted.” These detours also affect transportation in other parts of the world. With vessels and containers tied up in longer transits, capacity is tight throughout the global shipping network, and rates have increased accordingly.
Ocean carriers and shippers are also keeping a nervous eye on looming future disruptions like port strikes. Concerned about getting products to market in time for the holiday season, many companies are booking space early, causing a demand spike. Some shippers have pushed that spike even higher by double-booking the same cargo with different carriers to make sure they can secure the space they need. “Everyone thinks there’s twice as much demand, and the pricing goes up. It reinforces the panic,” Nielsen says. Double- booking also forces carriers to deal with last-minute cancellations and no-shows. A Spectrum of Strategies In the face of such varied, interconnected challenges, ocean carriers are doing their best to maintain their networks, provide containers where shippers need them, and offer sufficient space on vessels in order to deliver the best possible service. The strategies shipping lines employ vary, as do the results. “Some carriers have been successful in deploying vessels at the right time, so they’ve not been constrained in how much cargo they could move out of Asia and into the United States, for example,” Nielsen says.
October 2024 • Inbound Logistics 33
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