As a microcosm of the European shipping scene, Southampton takes some beating. The port is owned by Dubai World Ports and serves the twin markets of Cruise Liners (booming) and Container shipping (disaster). Unfortunately Southampton typically has four container ships for every cruise ship moored up at its quays and it is this highly visible sight of the city’s reason for existence that is most in trouble. Unlike other industries that appear to have stabilized and are now returning to growth, the container shipping industry is still badly depressed in Europe. Many of the world’s largest shipping lines serve the port including, Zim Lines, Evergreen and Hapag Lloyd. The world’s largest, Maersk, did run a service until they pulled out earlier this year. Dubai Ports doesn’t post figures for individual operating companies but Southampton’s great rival Hamburg, also serving the North Sea Asia routes and with the same lines providing regular services has seen trade slump 25% with tonnage dropping 23.7% in the first half and (TEU) container movements 28.7%. Many are expecting a major line to go down; they are cumulatively expected to lose about $12bn this year after making only $3bn profit last year.
Meanwhile container rates have collapsed from $1350/20′ box to $380 today. Chang Yung Fa, the boss of the fourth largest container fleet, Evergreen, estimates around 15% of the container vessels are idle or soon to be laid up and talks of a gruesome over capacity in the industry according to a business magazine in the city.
Meanwhile US ports are reporting a 17.7% drop in container movements from last year according to Logistics Management, but other reports suggest the market is beginning to pick up a little with projections for the balance of the year making modest gains.