Container Shipping Industry 2020-2021 Supply and Demand Review
Container Shipping Industry 2020-2021 Supply and Demand Review
Client: DG Competition, European Commission
Date:
2022
MDST was commissioned to carry out an independent fact-finding study of demand and supply and the level of market concentration in the container shipping industry in 2020 and 2021. This was to provide independent analysis to assist the European Commission in deciding whether to extend, amend or end the Consortium Block Exemption Regulation (CEBR) in April 2024.
The Question
What was the supply-demand balance in the container shipping industry and what was the extent of the shipping market concentration on trade corridors to and from the European Union at the height of the Covid-19 pandemic in 2020-21?
The Solution
- Analysed the estimated level of cargo traded in containers (measured in TEU) moved between the EU countries and the rest of the world split into world regions during the period 2020Q1-2021Q4 using its World Cargo Database
- Analysed how the volumes of cargo moved as estimated by MDST compared to the volumes reported by Container Trade Statistics (CTS) during the period 2020-2021
- Analysed the extent to which shipping lines (whether members of alliances or not) changed the level of scheduled capacity serving the EU countries during the period 2020Q1-2021Q4 using data from its Containership Databank
- Analysed whether, and to what extent, the level of capacity scheduled to be deployed was actually offered during the period 2020Q1-2021Q4 using AIS data
- Analysed the combined market shares by consortium and alliance offered to the market on each relevant trade corridor, using data from its Containership Databank
- Analysed the level of concentration in the container shipping industry and whether/how this has changed during the period 2020Q1-2021Q4, using its Consortia Market Concentration Index (CMCI)
Outcome
A report on the fact-finding study was published on the European Commission’s website and the supporting data was provided to the European Commission to inform its own analysis. In October 2023 the European Commission announced that:
“Based on the feedback received, the Commission has decided not to extend the CBER and to let it expire on 25 April 2024. The expiry of the CBER does not mean that cooperation between shipping lines becomes unlawful under EU antitrust rules. Instead, carriers operating to or from the EU will assess the compatibility of their co-operation agreements with EU antitrust rules based on the extensive guidance provided in the Horizontal Block Exemption Regulation and Specialisation Block Exemption Regulation.”
The MDST independent fact-finding study can be found here.
“Based on the feedback received, the Commission has decided not to extend the CBER and to let it expire on 25 April 2024. The expiry of the CBER does not mean that cooperation between shipping lines becomes unlawful under EU antitrust rules. Instead, carriers operating to or from the EU will assess the compatibility of their co-operation agreements with EU antitrust rules based on the extensive guidance provided in the Horizontal Block Exemption Regulation and Specialisation Block Exemption Regulation.”
The MDST independent fact-finding study can be found here.