Winds of Change in The Container Leasing Industry

Since 2013, shipping and railroad volumes have steadily been on the rise and the projection is that this trend will now continue, albeit at a slow and steady pace. Over the past one year there has been a consistent growth in demand for finished & raw goods from the emerging economies like China and other Asian countries. This has also resulted in an increase in demand for global transportation, a large percentage of which takes place via sea routes.

Slow and Steady

Shipping companies are still a little wary about increasing inventory and adding to operational costs and are now relaying largely on container leasing companies like Pacific Tycoon for transporting everything from perishables to iron ore. What is even more notable is the fact that they are now finding this more economical and convenient as they don’t have to worry about maintenance and upkeep of the containers. Today, things have reached such a stage where the supply of containers is very tight.

A Surging Current

This year, that shortage is going to be even greater. This trend might just turn into more of a longer-play opportunity. This also means that there is an opening to make a lucrative investment in this space. The trade agreements that had been brokered under Clinton had given a boost to the Chinese economy in the 1900’s and that current never abated. In January 2014, China’s trade performance touched a 6-month high. There was a 10.6% rise in total exports in China, in comparison to January 2013.

The country is the largest exporter in the world. Now the economies in developed countries are also on a rebound, which will fuel the country’s exports even further. Premier Li Keqiang has also now said that China will be accelerating the free-trade agreement with Australia. This too adds impetus to the overall growth that is taking place in the country.

The Horizon and Beyond

As trade increases, shipping companies will have to press more vessels into service and there will be a surge in the demand for containers. Container leasing companies like Pacific Tycoon are in for a busy and bright future. They are also sprucing-up their business models and making them more efficient. This helps in maintaining timelines and meeting increasing demands.  Since the demand still exceeds supply, they are also able to raise their rates and investors end up benefiting from the changing global and national economy.