Maersk has warned that traditional supply-and-demand dynamics are no longer sufficient to explain developments in the container shipping market, as geopolitical shifts, inventory management strategies and disruptions across transport networks increasingly influence market conditions.
Michael Britton, Maersk’s Head of North America Market – Ocean Product, explained that while supply and demand remain fundamental to container shipping, a growing number of factors are influencing how cargo demand develops and how much capacity is effectively available.Inventory decisions, changes in sourcing patterns and geopolitical uncertainty are increasingly affecting cargo flows, while constraints across ocean and inland transport networks can limit the industry’s ability to move goods efficiently.
As a result, assessing market conditions requires more than tracking cargo volumes and fleet capacity. A broader, network-level perspective is needed to understand how effectively goods move through interconnected ocean and landside supply chains, Maersk said.
Why is available capacity about more than the number of ships?
On the supply side, global fleet capacity remains an essential market indicator. However, headline fleet growth does not necessarily translate into capacity being available where and when it is needed. Effective capacity depends on how efficiently vessels, containers, terminals and inland networks can move cargo.
The scale of this effect can be significant. Sea-Intelligence estimates that vessel delays are currently absorbing approximately 5% of global deep-sea container capacity, equivalent to around 1.7 million TEU, compared with an average of 2.2% from 2011 to 2019.
This illustrates how operational disruption can materially reduce effective capacity even when nominal fleet capacity continues to grow.
Factors that can reduce effective capacity include:
- Changes to vessel rotations and service networks
- Equipment imbalances between import and export markets
- Longer vessel routings around disrupted trade corridors
- Congestion at ports, terminals and rail networks
- Road, rail and inland equipment constraints
- Warehousing capacity constraints
When vessels travel longer routes or arrive outside planned windows, capacity is absorbed and disruption can spread through terminal operations, vessel rotations, equipment positioning and onward transportation.
Trade imbalances can add further pressure. Strong import growth from Far East Asia and the Indian subcontinent has contributed to increasingly unbalanced trade flows across several trades. This can increase equipment-repositioning needs and add pressure to inland infrastructure and capacity across coastal and long-haul services.
Maersk has also observed congestion and disruption extending from ports into inland transportation, alongside persistent infrastructure bottlenecks.
Adding vessels may improve nominal supply, but it does not immediately resolve constraints at ports, terminals, rail networks or other inland infrastructure. Capacity therefore needs to be considered across the full cargo journey, not only in terms of ships and container slots. …said Britton.
How are geopolitics and sourcing diversification reshaping the market?
Geopolitical developments increasingly connect the demand and supply sides of container shipping.
Conflict or insecurity near major trade corridors can require vessels to take longer routes, affecting transit times, fuel consumption, vessel rotations and the amount of capacity available to serve other markets. At the same time, changes in trade policy can influence when customers place orders and where they source goods.
Some businesses may bring shipments forward ahead of anticipated tariff changes, while others may delay decisions as they wait for greater clarity.
Sourcing diversification adds another dimension. China and broader multi-country sourcing strategies are leading some organisations to expand supplier networks across Southeast Asia, the Indian subcontinent, Eastern Europe, Mexico and other markets.
Diversification can reduce dependence on a single sourcing location, but it can also create new ocean corridors, inland requirements, customs processes and equipment flows.
A sourcing decision can therefore affect more than demand on a single trade lane. It can alter where capacity is needed, how containers must be positioned and which ports and inland networks experience pressure.
Broader economic and technological shifts can also change the composition of trade. Electrification, growing energy demand and investment in digital infrastructure are contributing to growing demand for equipment, components and materials that may move through corridors already carrying substantial volumes of consumer goods.
This can create additional pressure not only on ocean services, but also on the ports, terminals and inland networks supporting those trades. This is another reason supply and demand need to be considered at trade-lane and network level, rather than solely through global totals.
Why have container freight rates become more volatile?
Freight rates ultimately reflect the balance between supply and demand. However, inventory replenishment, trade-flow imbalances, longer vessel routings, congestion, equipment availability and policy changes can alter that balance quickly on individual trade lanes.
If demand strengthens on a trade lane where available capacity is limited, prices can move quickly. Disruption can also tighten effective capacity even when the broader fleet appears sufficient. Conversely, when new vessel capacity enters a market faster than demand develops, rates can come under pressure.
Normal market economics have not stopped working. What has changed is the number of variables that can influence the speed, scale and location of the market response.
What does this more complex equation mean for customers and carriers?
A more complex supply-and-demand equation affects customers and transportation providers alike.
Customers make decisions about inventory, sourcing and fulfilment based on expected consumer demand and the commercial needs of their business, often before the full impact of changing transportation conditions becomes clear.
Carriers, in turn, make decisions about vessel deployment, equipment positioning, capacity allocation and network design based partly on expected cargo volumes.
When conditions change quickly, those decisions become more difficult for both sides. This increases the value of timely demand signals, realistic forecasts and transparent communication. It also makes it important to recognise that no single forecast can fully account for geopolitical developments, infrastructure limitations or abrupt changes in purchasing behaviour.
Contract structures can provide a clearer framework for expected volumes, seasonality and capacity needs, but effective planning also depends on realistic assumptions and a shared understanding of how market conditions may affect both cargo requirements and available capacity.
The objective is not to place responsibility on one side of the relationship, but to improve the quality of information on which customers and carriers make operational and commercial decisions.
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