4 Issues Facing Maritime Transport In 2021.It is a common saying in Maritime that shipping is the primary force driving global trade growth. And this was more than confirmed by the events that unfolded in 2020.
Maritime transport moves a substantial volume of the materials that are traded internationally – about 70 to 90 percent – and is essential to the closely woven supply chains present in the world.
So whatever threatens its ability to function efficiently and smoothly will not only affect workers within the industry, but will also disrupt markets in other sectors. Although the coronavirus remains a health menace to seafarers around the globe, it is not the only major challenge troubling global shipping, other problems exist that need to be addressed.
Besides safety, below are 3 other top challenges the shipping and maritime industry will have to tackle this year.
Safety at Sea
2020 was an extremely tough period for seafarers with the virus causing large numbers of crew to be marooned at sea, thereby losing valuable income that would have been earned during that time. Thankfully, even though the virus made its way into 2021, the development of the vaccine brings hope and relief to seafarers worldwide.
Everyone is awaiting the mass vaccination which will keep the virus at bay, ease the present restrictions on sailors and make global shipping more cost-effective and efficient.
High Rates and Chronic Shortages of Equipment
Safety measures due to the coronavirus made a significant amount of shipping lines to suspend all their freight bookings from Europe to Asia for several months last year. This led to high and sustained demands that have overwhelmed the shipping supply chain and the effect can still be felt in 2021.
The huge demand drove shipping rates up and created chronic equipment shortages we’ll likely be seeing in the first few months of this year. Up till now, some importers are yet to fully recover from the losses they incurred from the unexpected hike in sea freight rates.
Pricing for Profit
One of the main purposes of starting any business including a maritime transport company is to maximize benefits for the owners. However, this is becoming harder to achieve because of unreasonable freight rates that have led to some vicious competitiveness among shipping operators.
2021 will see maritime companies working hard to maximize profits and revenue. And the only tool in the marketing mix that generates revenue is pricing.
For companies to succeed in increasing profits, pricing should be given a top priority among all other business development efforts. Furthermore, when formulating a pricing strategy for shipping, it helps to have an expert team whose sole aim is to develop and supervise the process so as to achieve optimal pricing.
Cyber Security Threat
The shipping industry has always been targeted by cybercriminals and the danger is very much alive in 2021. Industry experts advise that as shipping fleets all over the world recover from the losses sustained amidst the pandemic, the owners and management should not release their guard.
The latest cyber-attacks on high-tech organizations like Google and a big software vendor in Germany, Software AG, has demonstrated the capabilities and sophistication of many cyber thugs and hackers. These events make it imperative for the maritime sector to be more vigilant towards cyber-attacks.
The damaging effect a successful cyber-attack would have on crew safety and shipping operations is better imagined than felt. That’s why one of the first tasks the International Maritime Organization (IMO) will be undertaking in January this year include:
- Introducing new safety rules
- Making it compulsory for ship owners, operators, and managers to add cyber risks into the safety management systems (SMS) on their vessels.
Operating profitably at sea/ports can be highly dependent on the customer’s industries but the right investments in HSE, pricing, supplier’s contract & technology will be business savers.
If you want more information on how to improve your maritime transport & operations more profitable, don’t hesitate to contact us.
4 Issues Facing Maritime Transport In 2021