Global maritime trade growth is expected to slow to
1.4% this year from 3.2% in 2021, the United Nations Conference on Trade and
Development (UNCTAD) said in its flagship report, Review of Maritime Transport
For the period 2023-2027, growth is seen expanding at an annual average
of 2.1%, a slower rate than the previous three-decade average of 3.3%, with
UNCTAD adding that “downside risks are weighing heavily on this forecast.”
It noted, “COVID-19, the war in Ukraine, climate change and geopolitics
have wreaked havoc on maritime transport and logistics, clogging some ports and
closing others, reconfiguring routes, extending delays and pushing up shipping
It called for greater investment in maritime supply chains, noting that
ports, shipping fleets and hinterland connections need to be better prepared
for future global crises, climate change and the transition to low-carbon
The supply chain crisis of the last two years has
shown that a mismatch between demand and supply of maritime logistics capacity
leads to surges in freight rates, congestion, and critical interruptions to
global value chains, UNCTAD said.
Ships carry over 80% of the goods traded globally, with the percentage
even higher for most developing countries, hence the urgent need to boost
resilience to shocks that disrupt supply chains, fuel inflation and affect the
poorest the most.
“We need to learn from the current supply chain crisis and prepare
better for future challenges and transitions. This includes enhancing
intermodal infrastructure, fleet renewal and improving port performance and
trade facilitation,” UNCTAD Secretary-General Rebeca Grynspan said in a
statement. “And we must not delay the decarbonization of shipping,” she added.
Logistics supply constraints combined with a surge in demand for
consumer goods and e-commerce pushed container spot freight rates to five times
their pre-pandemic levels in 2021, reaching a historical peak in early 2022 and
sharply increasing consumer prices. The rates have dropped since mid-2022 but
they remain high for oil and natural gas tanker cargo due to the ongoing energy
Dry bulk freight rates increased due to the war in Ukraine and related
economic measures, as well as the prolonged COVID-19 pandemic and supply chain
disruptions. An UNCTAD simulation projects that higher grain prices and dry
bulk freight rates can lead to a 1.2% increase in consumer food prices, with
higher increases in middle- and low-income countries.
“If there is one thing we have learned from the crisis of the last two
years it is that ports and shipping greatly matter for a well-functioning
global economy,” said Shamika Sirimanne, director of UNCTAD’s technology and
logistics division. “Higher freight rates have led to surging consumer prices,
especially for the most vulnerable. Interrupted supply chains led to lay-offs
and food insecurity.”
UNCTAD calls on countries to carefully assess potential changes in
shipping demand, develop and upgrade port infrastructure and hinterland
connections while involving the private sector. They should also bolster port
connectivity, expand storage and warehousing space and capabilities, minimize
labour and equipment shortages.
Many supply chain disruptions can also be eased through trade
facilitation, notably through digitalization, which cuts waiting and clearance
times in ports and speeds up documentary processes through e-documents and
The report shows that between 2020 and 2021 total carbon emissions from
the world maritime fleet increased by 4.7%, with most of the increases coming
from container ships, dry bulk and general cargo vessels.
The report also raises concern over the increasing average age of ships.
By number of ships, the current average age is 21.9 years, and by carrying
capacity 11.5 years. Ships are ageing partly due to uncertainty about future
technological developments and the most cost-efficient fuels, as well as about
changing regulations and carbon prices.
Investments in new ships that reduce greenhouse gas emissions will be
hampered by surging borrowing costs, a darkened economic outlook and regulatory
UNCTAD calls for more investment in technical and operational
improvements to cut the carbon footprint of maritime transport. These include
switching to alternative, low or zero-carbon fuels, optimizing operations,
using on-shore electricity when in ports and equipping vessels with
The report also calls for a predictable global regulatory framework for
investing in decarbonization and increased support for developing countries in
the energy transition. It further underlines the urgent need to adapt ports to
the impacts of climate change, especially in the most vulnerable nations.
UNCTAD urges the international community to ensure countries that are
most negatively affected by climate change – and have contributed the least to
its causes – are not negatively affected by climate mitigation efforts in
The report says the container shipping sector has been transformed by
horizontal consolidation through mergers and acquisitions. Shipping carriers
have also pursued vertical integration by investing in terminal operations and
other logistics services.
More competition is in order, said UNCTAD. “Over the last 25 years, the
top 20 carriers have increased their market share from 48 per cent to 91 per
cent, almost double. Such concentration can lead to abuse of market power,
constrained supply, and higher rates for shippers worldwide,” Grynspan noted.
In addition over the past five years, the four largest carriers
increased their market shares to control more than half of the global capacity.
The number of companies that provide services to importers and exporters
fell in 110 countries, notably in small island developing states, where at
times a duopoly of just two carriers dropped to a monopoly of one.
Market consolidation results in reduced competition, constrained supply,
and can lead to market power abuse and higher rates and prices for consumers.
Ship oversizing also raises concern. Between 2006 and 2022, the size of
the world’s largest container ships more than doubled from 9,380 twenty-foot
equivalent unit (TEU) to 23,992 TEU. The size of the largest ship in each
country almost tripled, thus ships grew faster than the volumes of cargo to
UNCTAD calls on competition and port authorities to work together
respond to industry consolidation with measures to protect competition. The
report urges stronger international cooperation on cross-border,
anticompetitive practices in maritime transport, based on the UN Set of
Competition Rules and Principles.
According to the report, meanwhile, international maritime trade bounced
back significantly in 2021 with an estimated growth of 3.2% and overall
shipments of 11 billion tons. This is an improvement of 7 percentage points
compared to the 3.8% decline in 2020.