Don't Blame Us for Container Market Chaos: World Shipping Council

The World Shipping Council sees abnormal demand behind the current container rate spikes. File Image / Pixabay

Container industry body the World Shipping Council has issued a robust defence of its members after reports of US President Joe Biden issuing an executive order aimed at increasing competition among liners.

Biden is due to announce the order formally later on Friday, according to media reports, directing the Federal Maritime Commission to 'protect American exporters from the high costs imposed by the ocean carriers'.

Container freight rates have surged over the past year on increased demand and as COVID-19 lockdown measures disrupted operations at some ports.

In an emailed statement on Friday the World Shipping Council said abnormal levels of demand were causing delays and rate hikes, and that more regulation would not solve the problem.

"Ocean carriers are employing all available capacity and pulling out all stops to manage the operational disruptions brought on by COVID-19," the organisation said in the statement.

"But when marine terminals cannot clear the cargo already on the docks, ships cannot berth to discharge and load cargo.

"And marine terminals cannot clear cargo if the importers of that cargo have no warehouse or distribution space to put those containers.

"And containers are stuck in many places in the U.S. waiting for adequate rail and truck capacity to move them."

The current market situation will only be resolved when demand is normalised again, John Butler, the organisation's CEO, said in the statement.

"The current supply chain disruptions are the result of an historic surge in demand by Americans for goods from overseas," he said.

"There is no market concentration 'problem' to 'fix', and punitive measures levied against carriers based on incorrect economic assumptions will not fix the congestion problems.

"Only normalized demand and an end to COVID-related operational challenges will solve the bottlenecks in the supply chain.

"We urge everyone to make decisions based on the real facts about the situation before we create long-term negative results through ill-considered regulatory changes to handle a temporary situation."