Ocean Exports: U.S. agricultural exporters clamor for space
June 13, 2008 by SwizStick
Filed under Seafreight
Thanks to the normally heavily lopsided Asian import imbalance in the U.S. carriers have generally organized capacity around import services and ignored export demand. And with the strong Euro and weaker demand for Trans-Pacific services carriers have re-routed larger vessels to the growing Asia-Europe trade lanes. However, exports from the U.S. have been booming as a result of the ever-weakening dollar, and that has led to a capacity crunch as exporters desperately try to find available equipment and capacity. Agricultural exporters expressed their frustration at the annual meeting of the Agricultural Transportation Coalition. Via LogisticsManagement:
The major paradox is that U.S. agricultural commodities are in tremendous demand, and these shippers are poised for the first time in many years to profit by this surge. Much to their dismay, however, is the fact that ocean carriers are making fewer inbound calls.
“When are the carriers going to realize that the balance of trade has shifted, and exporters are the new revenue drivers for this industry,” asked AgTC chief counsel, Peter Friedmann. “There’s a shortage of space in every area of shipping, including reefer and dry bulk. And this is not a temporary blip on the window of world trade…it’s an ongoing and long term phenomenon.”
Shipping analyst, Philip Damas, concurred. His presentation on Drewry Supply Chain Advisers’ most recent findings indicated that shippers were blindsided by the sudden shift in carrier deployment from the transpacific to the Asia-Europe trade lanes.
As the article clearly points out, there are no easy fixes. Exporters will have to make their business more attractive to carriers and export pricing will have to rise, which in turn might have the affect of driving down the attractiveness of exports in the first place. But that’s what will have to happen for carriers to better service the export market.
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