Thanks to constant focus on cost reduction and economies of scale, large containers ships are taking a huge share of the world’s trade. Cost efficiency is unlikely to stop, as the market remains very competitive.
If you look around in your living room, you will have a hard time finding anything that has not been delivered by ship. Indeed, such a globalized world could not see the light of the day without this key transportation method. Concretely, it is estimated that more than 90 percent of today’s world trade is currently delivered by only 6,000 large vessels which account for the transport of over 20 million containers per year. The largest of these ships can nowadays carry up to 20,000 containers per trip, with a length of around 400 meters and a surface with is the rough equivalent of four football fields.
Why is shipping delivery the uncontested leading method of goods delivery and a key component of today’s increasingly globalized world? The reason is simple: its unmatched cost. Indeed, sending a container from England to Hong Kong can cost less than 5,500 dollars, and a made in China t-shirt can be delivered to the Netherlands for less than 2.5 cents. Moreover, the industry is very competitive and filled with enterprises providing standardized offers. As a result, a strong price competition is taking place, with companies constantly looking for ways to lower their shipping costs. Such an outcome is for instance reached with increasing vessel automation, which enables shipping firms to use a smaller amount of workers per delivery. As an illustration, today’s largest deliveries can be undertaken by a crew of a dozen of sailors only. Besides, the capacity of these ships is constantly increasing for economies of scale purpose, in order to amortize oil consumption and other costs on more containers.
Does this trend mean that we will be able to see cargos transporting far over 20,000 containers over the long term? This is very unlikely to happen, as overcapacity issues are already arising. Indeed, some players in the industry are already struggling to get rid of their excess capacity and fill their vessels, some experts even claiming a size reduction would make more sense for the future.
Shipping containers will remain the most cost-effective method for global trade. Such containers as well as plenty of other metal products can be found at Shanghai Metal Corporation.
As a representative of the metal industry, Shanghai Metal Corporation is one of the leading businesses in the manufacturing of metal products in the global field. We can produce aluminum, stainless steel, copper, shipping containers and other metal products and service, and keep on eye on manufacturing efficiency and environmental sustainability.
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