Italy’s transport minister has voiced his concerns about the supersizing of boxships and the consolidation being seen within the container sector.
“It’s with great concern that we observe the ever increasing size of container vessels and the consolidation resulting from global carriers’ M&A on the market,” said minister Graziano Delrio at a conference held in Leghorn, Italy, commenting on a markets presentation given prior by Olaf Merk, a shipping expert with the OECD and regular Splash contributor.
Talking about the main global challenges for the container ports system, Merk stressed the importance of three main factors at the heart of global carriers’s growth strategy: bigger ships, industry concentration and vertical integration. Looking at alliance market shares of East-West container capacity he also added that more than 90% is controlled by 2M, THE Alliance and Ocean Alliance thus resulting in a sort of oligopoly and for the ports who now have an increasing dependence on these three alliances. Last but not least, bigger ships means more cargo peaks to be handled by ports, less choice for shippers and also extra costs for equipment and new infrastructure.
That’s why Italy’s transport minister said: “While there’s a cost per teu decrease with bigger ships, costs for ports are increasing. We need to set some boundaries within which the industry must work since it’s not acceptable that someone offloads the costs to the state and privatises the profits.”
Delrio concluded his speech saying: “We must not be simply dominated by container carriers but we should be able to impose certain conditions and set some boundaries within which trades can flow.”