COVID-19 impact on sea freight forwarding market by region and scenario 2020

The coronavirus outbreak poses a challenge for the world economy, negatively impacting global real GDP growth and affecting many industries. The international sea freight forwarding market is projected to contract by some 1.1 percent compared with the previous year under the ‘actual impact‘ scenario. In case of the ‘severe impact‘ scenario, the market is anticipated to contract by 7.3 percent. Regional markets will be affected differently, with the North American market suffering the most under both scenarios.

Decline in container shipping volume

Between January 2020 and June 2020, there was a considerable decline in container shipping volume compared with the previous year’s figures. This resulted in some 310 container ships staying idle in February alone.

Networked nature of the global container shipping market

When the outbreak of the virus became apparent in January 2020, governments across the globe started adopting measures that severely limited commercial activities, affecting both supply of and demand for goods. The sea freight forwarding market, however, is highly complex and interconnected, with many elements depending on one another. Many small cracks within the system can make it malfunction, further exacerbating the problems caused by the pandemic.