Source: adapted from Boile, M., Theofanis S., Golias M. and Mittal N. (2006) Empty
Marine Container Management: Addressing Locally a Global Problem. TRB Annual Meeting,
Washington, DC. Paper # 06-2147.
Container Flows and Repositioning
The positioning of empty containers is one of the most complex problem concerning global freight distribution, an issue being underlined by the fact that about 2.5 million TEU of containers are being stored empty, waiting to be used. Empties thus account for about 21% of global port handling. The major causes of this problem include:
- Trade imbalances. They are probably the most important source in the accumulation of empty containers in the global economy. A region that imports more than it exports will face the systematic accumulation of empty containers, while a region that exports more than it imports will face a shortage of containers. If this situation endures, a repositioning of large amounts of containers will be required between the two trade partners, involving higher transportation costs and tying up existing distribution capacities.
- Repositioning costs. They include a combination of inland transport and international transport costs. If they are low enough, a trade imbalance could endure without much of an impact as containers get repositioned. Repositioning costs can also get lower if imbalances are acute as carriers (and possibly terminal operators) will offer discounts for flows in the reverse direction of dominant flows.
- Manufacturing and leasing costs. If the costs of manufacturing new containers, or leasing existing units, are cheaper than repositioning them, which is particularly possible over long distances, then an accumulation can happen. Inversely, higher manufacturing or leasing costs may favor the repositioning of empty containers.
- Usage preferences. A large number of shipping lines uses containers as a way of branding the company name. This observation combined with the reluctance of shipping lines to share market information on container positions and quantities, makes it very difficult to establish container pools or to widely introduce the ‘grey box’ concept.