Low anticipated growth in North American and European markets from 2016 to 2018 means Asian traffic to the US and Europe will not expand, And although growth in 2016's shipping capacity is expected to be half of what it was in 2015, freight rates for cargo traveling on the high seas will drop or, at best, hold steady.
By the end of 2018, 17 carriers are expected to transport 32% of all tonnage (measured by teu capacity, i.e. the number of 20-foot long, 8-feet tall and wide shipping containers that a ship can carry) on their ultra large container ships. Smaller capacity ships will be hard pressed to stay in business.
At the same time the amount of tonnage being shipped is unlikely to increase, the capacity the Panama Canal can handle will double in 2016, when the current expansion project is expected to be completed. The enlarged canal will permit passage of more ships and the larger New Panamax ships that can carry twice as much cargo as current Panamax models.
(Additional information about cargo shipping is available on the earlier post, "What Do You Want to Be?)
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