Overcoming challenges in the evolving maritime world, fleet owners address many problems. More than 95,000 ships account for the global fleet. Since 1979, there’s been a threefold increase in global maritime commerce. Here are four challenges facing industry leaders.
Since 2020, global shutdowns have caused a significant decrease in the demand for goods, significantly reducing maritime trade. In order for fleets to make profits, ships must continue to transport goods between ports.
By 2021, the reopening of schools and businesses sparked an increase in demand for goods, which subsequently increased maritime commerce. Still, the spread of variants threatens to derail progress, as some countries are implementing additional shutdowns to protect populations.
Maritime vessels transport nearly 90 percent of global products. Piracy is one of the biggest threats to trade. Pirates hijack vessels, stealing the goods, and often hold crew’s hostage—North America, Asia, and Europe all transport energy products through Guinea’s Gulf.
Captain’s generally sped through areas like the Gulf, which are havens for pirates. Increasing speed elevates a ship’s fuel consumption. In addition, billions of dollars in goods are at risk, and insurance rates also skyrocket. It is estimated that West African piracy costs the maritime industry more than $500 billion a year.
In 1960, US vessels transported 16 percent of the global cargo. Today, U.S. Vessels account for just 2 percent of maritime shipping. It’s a shocking reality, considering America consumes the most goods from maritime trade relative to other countries.
The risky and, at times, unprofitable maritime commerce business has seen a significant reduction in government investment in the industry. Demand for goods is projected to increase substantially by 2022. However, vessel shortages may cause an increase in transportation prices.
Environmental policy and trade deals are often negotiated in tandem. Maritime commerce is one of the world’s largest carbon producers. Ironically, the environmental impact of carbon production on the climate may cause extreme weather events, disrupting global trade.
Rising sea levels and extreme weather events are expected to prompt frequent port closings. Alternatively, positive economic impacts from climate change may include the opening of shipping routes in the Arctic.
Unfortunately, unless the maritime industry reaches its no-carbon emissions goals, expanding Arctic shipping routes may ultimately lead to increased environmental damage.