Shipping Congestions and higher prices will continue until ends of 2022 according to Morgan Stanley

Shipping Congestions and higher prices will continue until ends of 2022 according to Morgan Stanley

Shipping congestions will continually to persist long time from now, until end of 2022. Also, transportation prices will still remain high. After Covid19 that is “the perfect storm” for this, other factors influenced transportation further:

  • Semiconductor chip crunch affected trucks production;
  • Shortage in containers;
  • Shortage in trucks drivers (most of them have changed their job since pandemic outbreak).

Instead of transportation bottlenecks, companies in this segment performed better than SPX. Companies like AP Moeller Maersk (MAERSKa) or Silo Maritime Perdana Tbk (SHIP) have grown over 150% in just one year.

The Freights Baltic Index, which measures global container prices, currently stands at an average $10,321 per 40-foot container, with over 400% price increase before pandemic Covid19 Outbreak.

The Freights Baltic Index

Investment Bank Morgan Stanley, according to a research sent to investors last week, expects shipping revenues to stay high at least through the second quarter of 2022. All ports in US are opened 24h day but instead of that, we still have congestions since we don’t have enough trucks and drivers to deliver goods to consumers.

We find difficult and risky to invest just now in this field after 150% growth, momentum is too late, but who invested in this area will have some time horizon to cash out some profits.