Go back fifty years, and international shipping was a relatively small player in the global market. Most countries conducted the vast majority of their trade within their own borders. A few companies branched out overseas, but this was not the norm. Fast forward fifty years and the international situation has changed completely. We’re in another golden age of globalisation, fuelled by digital communications technology.
Of course, no industry has been changed more by this process than the shipping industry. Ever since the 1950s, the growth rate of international trade has been double the growth rate of the whole world. And the growth rate of the whole world has been continuing at quite a fast pace. From 2000 to the eve of the financial crisis, global trade expanded nearly 50 percent, thanks to the rise of China. And since the financial crisis, the world has continued to become more integrated. We’re living in a global village. And international shipping is the way we all do our business. Now, about 45 percent of all the economic activity in the world is trading between countries.
But things aren’t static. The international shipping business is now having to adapt to a radically different economy. Fifty years ago, the shipping trade was dominated by the transport of raw materials. But as consumers get richer, the nature of goods is changing. Crucially, the weight-to-quality ratio of products is changing. Products are becoming higher quality and lighter. And this is forcing shipping companies to change how they operate. Relative to the value of the goods on ships, the cost of transporting them is falling.
Secondly, there’s a bigger market for bespoke shipping services. Businesses and consumers don’t want to have to buy in bulk every time they make an order from abroad. They want to be able to send their own compartmentalised shipping containers aboard a ship. That explains why we’re now seeing companies like zeecontainer.nl offer individual shipping containers. It’s a trend that’s likely to continue.
Third, consumers are no longer willing to tolerate long delays. In other words, shipping businesses can’t wait to ship until a time that suits them. They have to start coming up with clever systems to deliver goods on a flexible schedule.
In the future, we can expect the nature of shipping to change again. The recent expansion of the Panama Canal is a testament to the rising importance of shipping on the world scene. And with more trade openness every year, it doesn’t look the trend towards increasing trade is slowing down.
Maritime traffic is being fuelled by the appetites of consumer all over the world. China is expanding mineral extraction and raw material acquisition from overseas. The East is still outputting vast quantities of manufactures, bought by the West. And agreements like GATT mean that trade is being opened up all over the world.
But there’s one final thing to say about the change in shipping. Communications are going to alter the way that it is done. Businesses are going to start expected the level of service customers now get from delivery companies from the bulk carriers. That means that they will want something flexible that provides them with regular updates going forward.