In response to President Biden’s planned attack on ocean carriers during the State of the Union Address, the World Shipping Council released the following statement: Unfortunately, the President is demonising ocean carriers, the industry that is the backbone of the U.S. and global economy and that has been working around the clock through the pandemic to move more cargo than at any time in history.
Correcting the allegations
Allegations that the container shipping industry is highly concentrated and uncompetitive are factually incorrect. Ocean carriers actively compete against one another in the global marketplace, including on the shipping lanes most relevant for U.S. trade, while concentration levels in many other U.S. industries are markedly higher than those in container shipping.
In a clear sign of a competitive market responding to increased demand, competition increased in 2021, with more ships operated by a larger pool of carriers serving the trans-Pacific trade. The bottom line is that container shipping is a very competitive industry this is what the numbers show. Regulators in the U.S. and Europe have repeatedly and recently confirmed that this is the case.
Strengthening the intermodal transportation system
The deeply flawed Ocean Shipping Reform Act passed by the House will not solve the landside logistics breakdowns that are at the heart of America’s supply chain problems. The legislation as written would make existing congestion worse and stifle innovation.
Policymakers must instead address the root cause of the logjam by seeking real solutions that take a comprehensive, forward-looking view of the supply chain, further strengthening the intermodal transportation system that has supported the U.S. economy throughout the pandemic.
