With the gradual recovery of the economy, global demand has become stronger, especially in the shipping industry, which is most closely connected with international trade in goods. Continued global imbalances have further pushed up prices.

1.The problems that have accumulated since the beginning of the epidemic include:

a. Imbalances in the production and demand of goods.

b. Blockade and opening of various countries at different times.

c. Shipping companies cut the capacity of major routes.

d. There is a shortage of empty containers.

2.Reducing blank voyages will help ease capacity restrictions.

Globally, the capacity of major routes has actually returned to the level before the 2020 blockade, although the blank voyages in the first quarter reduced the planned capacity by 10%. There are signs of improvement this quarter. According to the current fleet plan, the number of blank voyages is 4%. But the cancellation of the voyage is to a certain extent a response to the delay, and it is forced to cancel. Therefore, although the transportation system is still tight, a small amount of capacity may still be reduced in a short period of time to deal with delays.

3.Port congestion and closure continue to cause delays.

Just like the link between voyage cancellation and voyage delay, congestion is part of the problem. The shipping performance in 2021 continues the situation in 2020. The proportion of ships sailing as planned has decreased, and the average delay time of overdue ships has increased.

There are signs that the performance of ships will improve, because the proportion of ships arriving on time did not decline in April, and the average delay time of ships has also begun to improve, but the overall performance is still the lowest level in a decade.

All in all, in the short term, due to further growth in demand and restrictions such as port congestion, freight rates may reach new highs. Even if capacity restrictions can be eased, freight rates may remain at a higher level than before the epidemic.