The “capacity crunch” in container shipping markets is likely to remain until the end of 2023, according to Bimco chief shipping analyst Peter Sand.

He told a London International Shipping Week (LISW21) webinar that it would be another 12 months before the backlog in container ports is unwound.

“It could actually be we need to go all the way until 2023 and the Chinese New Year at that point in time until we get to what might be the next normal,” he said at a S&P Global Platts and Bimco webinar.

“But it’s not going back to any normality at any time soon, because it takes a long time to unwind all these disruptions that have just piled up on top of each other, especially in the hinterland.”

Sand said it is not necessarily a shortage of container shipping capacity that is leading to high freight rates.

He suggested that it is also a result of inland logistics problems.

That was highlighted by the build-up of more than 50 containerships at anchorage or waiting to berth in the San Pedro Bay on the US West Coast.

Transpacific culprit

Sand said global demand for container shipping had jumped by 12% in seven months in 2021.

This was driven by growth of volumes on the transpacific, where volumes were up 33.3% in the first seven months of the year.

That has pushed up transpacific spot rates from $8,000 per 40-foot equivalent unit (feu) at the start of the year to $14,000 per feu at the end of August, according to freight rate benchmarking website Xeneta.

Lines had responded by investing in a record 3.3m teu of newbuilding orders this year.

But those vessels were not scheduled for delivery until 2023 to 2025.

So Sand said the “capacity crunch” was likely to stick around for the entirety of next year.

“It’s not necessarily a lack of containership capacity that is driving up container freight rates on a global scale," he said. "It’s the hinterland activity that needs to unwind."

What will cool red hot market?

Sand said the easing of US fiscal incentives was likely to have a cooling effect on retail spending that had fuelled demand for containerised imports.

“That is one of the factors we need to take the temperature out of this red-hot market and begin to see container freight rates on somewhat of a decline,” the analyst said.

But he questioned whether attempts by liner companies including CMA CGM to place a cap on further rate rises in the spot market would have an impact.

He said this would depend upon whether surcharges are included.