In the mind of most analysts, the shipping industry has already hit rock-bottom and is well on its way to a full recovery. After suffering through years of vessel over-capacity and falling container lease rates, global container shipping companies are finally in a position to better utilize their larger vessels, like the Maersk Triple E fleet, and make a strong effort to return cargo rates to pre-2008 levels. In fact, just recently it was suggested that container lease rates will rise incrementally, beginning in March of 2014. Some say that within a year it can be expected that the cost of leasing a shipping container will be nearly what it was before the financial crisis struck the world.
Aside from an increase in revenues resulting from a rise in lease rates, the demand for shipping containers is expected to continue to grow continuously, in an effort to meet the world’s economic growth figures. In some regions, Maersk expects as much as 5 percent growth in the need for shipping containers internationally. This spells big opportunities for the investment community. Especially for investors who are investing in maritime assets, like shipping container investments.
To addressing the industry’s nagging issues of over-capacity, many of the world’s leading container shipping lines have taken an rather unconventional approach. They have merged with their competition, to create formidable shipping alliances. The most notable being the G6, CKYH and the newly proposed P3 container shipping alliance. Each of these partnerships allows its members to share shipping resources on major trade routes, thereby improving over-all operating efficiency and increasing profits.
It has become more apparent that over the last several years, during the worst of the economic downturn, shipping industry leaders were building opportunities and exploring options, which have helped them emerge from the GFC stronger than when they went in. Collectively they have become more efficient and more profitable. This sort of positive performance is inspiring investors to learn more about Pacific Tycoon’s offer to invest in the global shipping industry and discover how to profit from economic growth around the world.
As the stock market continues to have investors holding their breath, profits and consistent investment returns can still come from many different, less dour sources, like an investment in the global shipping industry; for example. In my experience, every time economic growth increases, the demand for shipping containers rises alongside. Investors must understand that when signals in the traditional markets turn dim, there is likely some underlying reasons for fluctuations. Often, it may be climate related, labor management difficulties, litigation that removes focus from a company’s business goals, turnover on a Board of Directors; and a myriad other reasons. Sadly, the international shipping industry is a sector that is often overlooked, despite the fact that it is the main driving force behind worldwide economic growth and continued prosperity.
Coming as a surprise to some, shipping containers are one such investment vehicle found in the shipping industry that can offer steady returns for investors, even if only a small portion of the overall portfolio is dedicated to hard assets and alternative investments. Wise investors know that shipping container demand is closely tied to gross domestic production (GDP) and thus the increase in demand for consumer and industrial goods triggers the inherent need for moving goods to market, from manufacturer to customer, by way of a well-established and dependable worldwide container shipping system. When imports or exports rise, this is an indication of improved economic activity. At the moment, demand for goods from Asia and the Mid-East has been increasing in Europe and the United States, signalling a steadily improving international economy.
People have a preconceived notion that shipping containers come in one or two sizes, along with a tanker car. That could not be further from the truth. The different types of containers and the means to transport them are sundry, and some come in multiple sizes. Nowadays, there is a container for (practically) every need. Shipping containers of one type can be used for durable goods, while another may be for textiles and soft goods. Automobiles have specific container requirements, as do coffee beans and perishables. Regardless of their cargo though, an investment in shipping containers will allow investors to profit from economic growth and prosperity, all around the world.