Is the sea transport into a real “cosmic storm”?

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Gli equilibri stravolti con l’inizio della pandemia: the ‘Italian Maritime Economy’ 2021

The balance of global maritime trade has been significantly affected by the COVID-19 pandemic.

According to the ‘Italian Maritime Economy’ 2021 by SRM, sea transport continues to be the main vehicle for the development of international trade: 90% of goods travel by sea. Maritime transport and logistics account for about 12% of global GDP.

Maritime traffic volumes are estimated to increase by 4.2% in 2021, to reach 12 billion tons, above pre-Covid-19 levels. For 2022, estimates call for a further increase of 3.1%.

The container field, which represents the preferred mode of transport for the world trade in goods, has experienced constant growth since July 2020 with the demand recovery especially from Europe and North America, has recorded constant growth that led it to close 2020 with a reduction of just 1.1%. Growth of 8.7% is estimated for 2021 and 4.7% for 2022.

In Italy, the international component of sea transport remains significant. In 2020, Italy’s seaborne trade amounted to over €206 bn, a -17% decrease versus 2019. In the first quarter of 2021, seaborne imports and exports were up 3%

 

Photo by Rinson Chory on Unsplash
Photo by Rinson Chory on Unsplash

 

The redefinition of some supply chains and the strategic role of the Mediterranean

Congested ports due to outbreaks, sharp rises in freight rates, a dearth of empty containers and blank sailing (cancelled routes) were the major phenomena that impacted the balance of maritime traffic, especially on the Far East-Mediterranean and Far-East USA routes

Freight rates reached record levels on the main routes and do not yet show signs of slowing down: they are estimated to be high in 2021 at +22.6% with a readjustment of -9.4% in 2022.

These factors made increase the rail transport on the China-Europe route (and in the reverse direction) considerably. In the first quarter of 2021, the number of freight trains hit a record 3,345, up 79% over the same period in 2020.

The container ship Ever Given blockage of the Suez Canal (which paralyzed ship traffic for almost a week) and partial port disruption of the Yantian terminal in Shenzhen  highlights another vulnerability in global supply chains and the international trade.

 

 

MarineTraffic map showing buildup of ships outside Yantian
MarineTraffic map showing buildup of ships outside Yantian 01/06/2021

 

This situation, but also the development and implementation of regional trade agreements (e.g. NAFTA, RCEP and AfCFTA) and the ongoing trade tensions between major economies could contribute to changes in the production patterns of global value chains, providing further impulse to reshoring and nearshoring trends.

The redefinition of some supply chains on a regional scale will bring some sectors back to Europe, and this could further promote the growth of short sea shipping, in which the Mediterranean already has a leading position in Europe.

 

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