BLUE attended a briefing last week hosted by IHS Maritime & Trade on the topic of the evolving trends shaping shipping. In a typically insightful and thought-provoking presentation, IHS’s Richard Clayton identified five key trends that are playing an influential role in determining the future of the shipping industry: the ‘new normal’ of China’s economic growth, and the restructuring of the Chinese economy; low cost oil, and the geopolitical and economic factors set to lock in the oil price at close to $50 a barrel; a new wave of corporate consolidation to tackle shipping’s traditional fragmentation; the digital revolution, encompassing both the benefits and the cyber-security risk; and, rethinking shipping’s position within the wider supply chain.
Thousands of words could be written on each one of these subjects and many hours spent debating what they individually mean for the future of shipping. However, the most important insight was the futility of attempting to reach any meaningful conclusion by considering one of these factors in isolation. To understand what the future holds for you, your business and your marketplace, it is necessary to understand the connections between these issues, as the impact of all of these trends will be intertwined, cumulative and, as a result, harder to predict.
As Richard observed, a less fragmented industry can be more efficient and a better-connected industry can be more profitable. But this requires us to understand that human trends in shipping – such as the predicted shortfall in manning levels – can only be properly understood by connecting them with technological trends, such as the growing interest in autonomous shipping.
What’s more, different trends pull in different directions. The rise of digitalisation may create new scope for technological innovation and competition, but is there a risk that market consolidation and the rise of a few global giants will make it harder for a new entrant to deliver a disruptive change to this established order?
Here at BLUE, we help our clients to join these dots. As shipping industry specialists, we have a wide-vision perspective on how a multitude of trends are impacting on different parts of the industry in different ways. Whether through our In-depth Insight research work or the strategic communications support delivered to all our clients, we help them to understand how their market is evolving, the trends affecting their business, and the opportunities that can be seized upon. In so doing, we not only help them to plot the right course, but to play a leading role in industry debate around precisely what that future should look like.
It is human nature to ‘take one thing at a time’ and shipping can appear frustratingly siloed at times, particularly in the world of policy-making and regulation. But any maritime business that wants to understand what their world will look like in 2017, 2018 and beyond needs to appreciate the trends shaping the future of shipping are irrevocably interconnected.
By Simon Phillips, Senior Consultant