The container shipping industry is currently navigating turbulent waters, grappling with a complex mix of economic, geopolitical, and environmental challenges that are reshaping its landscape. In 2025, shipping companies will face rising operational costs, intensified competition, overcapacity, and increasingly intricate geopolitical risks. This environment demands careful analysis to identify not only the obstacles but also opportunities for innovation and growth. To assist industry stakeholders, Upply has outlined three possible scenarios for the global container shipping sector.
According to the study, one of the key transformations affecting the industry is the widespread increase in operating expenses. Port charges and ancillary services such as piloting, towing, and dredging are steadily rising, driven by the demand for modern and more efficient infrastructure. Adding to this are escalating fuel costs, influenced by sanctions on the "shadow" fleet transporting Russian oil and stricter regulations, which are reshaping market dynamics in major global hubs like Rotterdam and Singapore. Geopolitical instability, particularly along critical routes such as the Red Sea and the Suez Canal, is also driving costs higher. In some cases, operators are forced to resort to alternative routes like the Cape of Good Hope, which can increase container shipping costs by up to $1,000 per unit.
In addition to economic and geopolitical pressures, Upply highlights the rising risks associated with digitalisation. The growing frequency of cyberattacks is compelling companies to invest heavily in technological security, while the transport of hazardous goods like lithium batteries introduces new risk factors, including higher insurance premiums to mitigate fire hazards. Meanwhile, the push for ecological transition entails significant expenditure on research and development for green fuels and sustainable technologies. Extreme weather events, which damage key port infrastructure in locations such as Shanghai and Valencia, further exacerbate cost pressures.
Despite these inflationary pressures, the research notes some factors that could alleviate cost increases. The influx of new, large container vessels ordered during the post-pandemic boom is creating substantial overcapacity, leading to lower freight rates as carriers compete to fill volumes. Furthermore, the restructuring of shipping alliances, expected in 2025, could foster new competitive dynamics, improving operational efficiency and reducing overall costs. Upply's report presents three potential developments for the sector, each with strategic and operational implications that could redefine the global market.
In the first scenario, Mediterranean Shipping Company (MSC) consolidates its position as the global leader, surpassing 20% of the market share. Armed with a modern, technologically advanced fleet and direct control over numerous port terminals, MSC reduces operational costs and sets freight rates. Its strategy centres on partnerships with major international freight forwarders, ensuring stable volumes at preferential rates. However, this concentration of power risks polarising the market, making it increasingly challenging for competitors to operate on the same scale.
The second scenario envisions decisive intervention by governments and institutions to limit MSC's dominance. In the United States, the Federal Maritime Commission has already adopted a stricter approach, while in Europe, the end of exemptions for shipping alliances could lead to tougher antitrust regulations. In Asia, state-owned companies like COSCO could pose significant challenges, while in Africa, MSC’s acquisition of Bolloré Africa Logistics may not suffice to counter Chinese and Russian expansion.
The third scenario sees the United States embarking on an ambitious strategy to reclaim its status as a maritime power. Although currently controlling only 1% of global capacity, new industrial policies could drive shipbuilding and strengthen national logistics. This transformation would be bolstered by strategic alliances with South Korea and Japan, as well as collaborations with established players such as Maersk Limited and the Gemini alliance. However, such a resurgence would require substantial investment and long-term political commitment.
