The Port of No Return
1. On September 21st. The Journal of Commerce cited a pessimistic report issued by the World Trade Organization. Here’s basically what the WTO sees:
“The World Trade Organization on Friday downgraded its trade growth forecast for 2012 by 32 percent and by 10.6 percent in 2013, citing slowing global output amid a more interconnected marketplace …
“The continuing European sovereign debt crisis and the resulting drop in trade with EU members was the main driver of the WTO’s downgraded forecast. Disappointing U.S. production and job growth, along with a slowing Chinese manufacturing expansion, also spurred the forecast revision.
“‘All of these factors have contributed to an easing of global trade growth, which slowed to a crawl in the second quarter according to new quarterly merchandise trade volume statistics compiled by the WTO,’ according to the organization.” –
2. Then on October 11th, Cargo Business News reported more pessimism: “The container industry shows no real signs of recovery, according to an industry report, due to ongoing supply side pressure. Container lines will remain in ‘transition mode’ until at least 2014 and probably 2015, according to Drewry’s ‘Container Market Review and Forecast 2012/2013.’
“Freight rates and overall profitability will depend on how well the operators manage overcapacity, which should include heavy use of slow steaming and idling of capacity, which have been at a low level over the past year …
“The lack of any apparent peak season trade this year is putting serious pressure on container lines. Average Asia-to-Northern Europe spot freight rates have plunged 40 percent since may, says the report.” –
Everyone is familiar with the WTO and Drewry. For the most part, those analysts tell it like it is. But that’s not what the leading lights in the industry want you to know. They hire their own “experts”, you see, to keep the ignorant (and gullible) public from knowing what’s really going on. Those “experts” – according to Port Technology International – are warning us that our “US ports are unprepared for Panama Canal expansion. Officials state only one port is currently ready for expansion. Experts have warned the United States that they are in danger of missing a major trade boost, with their reluctance to invest in the country’s port infrastructure ahead of the Panama Canal. If the planned expansion was completed tomorrow,” those “experts” warn, “only one US port would be sufficiently ready to accommodate the influx of larger ships stemming (sic) from the canal …” –
Would those “experts” mind telling the unemployed folks in the US how to find a way to pay for all the goods carried by that “influx of larger ships”? Or better still, can they tell the unemployed where they can get the money to “invest in the country’s port infrastructure?” They’re screwballs – or liars.