Fluctuating demand creates volatile container market

ALAN PEAT
THE GLOBAL container market has been very volatile in the last two years, according to Christopher Lee, MD of container supply and conversion company, Container World. It’s been a period in which container prices first fluctuated rapidly upward and nearly doubled in 2004, then changing market conditions saw it spike sharply downward. The upward turn, said Lee, was purely a supply-and-demand situation – with big orders being placed because of growing international trade demand from the container leasing industry, and by shipping lines for the huge numbers of very large container ships (VLCS) being ordered and supplied. “This,” he said, “rather overwhelmed the supply and pushed prices ever upward. But it was soon followed by a large number of new producers entering the market, and the supply/demand scene changing dramatically – with the Chinese production market (which contributes about 70% of the annual supply) stockpiling up to 750 000 units at one stage. “The market turned round in the third quarter of 2005, with a sharp downward correction in market demand, and prices had dropped by about 25% by the end of the year – from where it has flattened for the first half of this year, and is likely to remain so.” Reliable expands fleet TWO YEARS since its launch, Reliable Transport Services is expanding its fleet to cater for growing demand, particularly on the Durban – Lesotho route, says managing director Strini Naidoo. The Lesotho-based company offers a daily service between Lesotho and Durban and a weekly option on the Durban – Zimbabwe route. “We currently have a fleet of ten vehicles – 6 superlinks and 4 triaxles – and are in the process of buying several more,” he told FTW. “We expect to have a fleet of 20 by next year.” The company moves a variety of general cargo – containerised and breakbulk – on the routes it serves and can offer outsourced warehousing and clearing facilities if required.