For many operating companies involved in the ports sector, 2022 has been a challenging year and, although next year appears to have some brighter prospects, there will be no shortage of challenges as the industry looks to regain stability.
Cost inflation, wage pressures and lower trade volumes have all combined to make 2022 difficult as the sector sought to recover from the ravages of the pandemic.
Arguably, the effect of rising costs and stuttering trade globally has yet to be seen fully as we await the full impact of deflationary strategies that will likely lead to lower factory outputs and job implications.
The forecasts suggest that, although the deflationary measures are having an initial effect, it could be some time before trade volumes regain stability, let alone grow. Meanwhile, the port sector has to do its best to control costs while continuing to deliver the quality of service expected.
After this year’s rise in passenger numbers at all the UK ports where we service cruise ships and provide passenger parking, we hope that the industry will continue its path towards pre-pandemic levels in 2023. However, much rests on the consumer and how resilient the economy is to the cost of living challenges.
The drop in global demand for consumer and capital goods has also been felt in our cargo volumes handled at ports like Southampton and again there looks to be no short term remedy to the economic issues that dictate the level of export and import cargoes that arrive on the quaysides.
While the whole shipping and port sectors are vulnerable to the downturn in cargo volumes, the challenges need to be faced by everyone rather than the pressures being borne disproportionately by individual parts of the sector.
Shippers, vessel and port operators cannot expect their suppliers to tolerate cost pressures without understanding that services will suffer if they are made to shoulder more than a fair share of the burden.
We will continue to try and sustain the same levels of service within realistic rate parameters but it will not be possible for labour suppliers to do so unless customers realise that part of the increased cost burden must be accepted across the board.
Once that has been recognised, the shipping and port sectors will be in a stronger position to weather the challenges next year will inevitably bring.