Shipping analyst Lars Jensen forecasts that the container shipping industry is on track for substantial overcapacity over the next two years. He suggests that only a confluence of four major, currently unforeseen, factors could avert this market condition. This outlook implies that the current challenges of excess vessel supply will likely persist, impacting freight rates and carrier profitability.
For freight forwarders and shippers, this anticipated overcapacity generally translates into a buyer's market. Increased vessel space and competition among carriers are expected to drive down freight rates on major trade lanes. This could offer opportunities for more favorable contract negotiations and potentially greater flexibility in routing and scheduling. However, it also means carriers may implement strategies like blank sailings or slow steaming to manage capacity, which could affect schedule reliability.
