Summary List Placement
The price for a shipping container is looking a lot like a meme stock.
The surge in shipping costs points to our shortage of semiconductors, lumber, chicken, chlorine, and, really, “just about everything.” The pandemic broke the supply chain last year, and the shipping companies that move stuff all over the world still haven’t recovered.
We rely on a complex, global supply chain. It’s the reason we can get two-day shipping on ultra-cheap Wayfair furniture built in Vietnam or why seafood caught in the US is so cheap (much of it is actually processed in China before it’s shipped back here).
Ocean shipping powers our ability to buy a massive variety of inexpensive stuff. This system needs many things to function, but I’ll distill those into a few important elements:
Massive ocean-faring ships
Containers on the ships
Places for the ships to park so that the containers can be unloaded
And, all of those things have broken at some point in the last year and a half! In fact, many of them are still broken. Here’s how that happened and why the shortages are still going on.
Our world’s weird new megaships
I am a newbie to the world of shipping. So, to better understand what’s going on with our current chaos, I chatted with Simon Sundboell, a 20-year veteran of the world of container shipping based in Copenhagen. He’s the founder of ocean shipping intelligence firm eeSea.
To understand the shipping debacle, Sundboell took me back to the mid-2000s. Ocean shipping was a more fragmented industry than it is today, and manufacturers and retailers could pit these various firms against each other to win low rates. To reach economies of scale, major ocean carriers began demanding larger ships.
An analysis of the fleet listed on the website of Hapag-Lloyd, which is the world’s sixth-largest ocean …read more
Source:: Business Insider