Containerized Shipping & Logistics Market Report Published

Conditions will eventually improve for the industry over the next five years according to IBISWorld's market research.

Excerpts from the synopsis provided follow:

The report says that after years of easy growth, life became more difficult for operators in the industry in the second half of 2008. A crisis that began in the US housing market spread into a global recession, severely affecting world GDP. As a result, demand for merchandise imports and exports went into free fall while international seaborne trade volumes decreased.

However conditions will slowly improve, but  the much-anticipated upswing may not occur early enough to save some players in the freight segments. The bright spot in the shipping industry will continue to be the cruise market in the short term.

According to IBISWorld industry analyst Caroline Finch, industry revenue is estimated to increase from $151 billion in 2007 to $155.5 billion in 2012, representing a 0.6% annualized increase, including 0.1% expected for 2012. In contrast, industry revenue grew an annualized 11.5% in the five years through 2007.

Overcapacity is the only certainty the industry faces in the coming years. The industry is dependent on strong global growth and continuing globalization to grow. The threat of a collapse in the Eurozone or a double-dip global recession remains real. On the other side of the equation, the imbalance of supply of ships to demand for shipping services will take longer to resolve.

Segments of the industry, such as container shipping, are engaged in a race to build the biggest ship. The operator with the biggest ship captures the lowest cost structure and competitive advantage. However, the cumulative action has driven freight rates down and is expected to keep them there.

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