Deep Sea Cargo Transportation Services Procurement Category Market Research Report from IBISWorld Has Been Updated - FOX Carolina 21

Deep Sea Cargo Transportation Services Procurement Category Market Research Report from IBISWorld Has Been Updated

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Rising trade volumes and industrial production have increased demand, pressuring prices upward over the past three years. For these reasons and to help procurement professionals make better buying decisions faster, business intelligence firm IBISWorld has updated a report on the procurement of Deep Sea Cargo Transportation Services in its growing collection of procurement category market research reports.

Los Angeles, CA (PRWEB) August 26, 2014

Deep sea cargo transportation services have a buyer power score of 3.5 out of 5, indicating relatively high buyer power. The primary market characteristic that favors buyers is low price growth, which has occurred despite heightened trade volumes and an ongoing shift away from airfreight and toward waterborne transport. In 2014, deep sea carriers' primary input costs, fuel and wages, have shown only marginal growth over 2011 levels, limiting cost pass-through, says IBISWorld procurement analyst Hayden Shipp.

Furthermore, carriers' capacity expansions have helped curb the rate of price growth. Ships ordered during 2010 and 2011, when trade volumes boomed, have recently been delivered. Carriers have not retired older ships at a fast enough pace to keep capacity in check relative to demand, adds Shipp. Competition between carriers for market share has been the cause of carriers' undisciplined capacity expansions.

However, over the next three years, the deep sea cargo transportation services market is expected to more discipline in matching capacity to demand due to the formation of the P3 alliance in 2014. Comprised of the market's three largest carriers (i.e., Maersk Line, CMA-CGM and Mediterranean Shipping Co.), the alliance will benefit its members by lowering costs through shared ships and port facilities. While this effect and close monitoring by regulatory bodies will restrict price growth, the fact that the alliance will control a vast share of global shipping traffic will ultimately cause prices to rise at a slightly faster rate than they have over the past three years. Still, price growth is forecast to be low enough that buyers' purchasing power will continue to improve relative to inflation.

Buyer power is hampered by carriers' reliance on nonnegotiable fuel surcharges. Because fuel prices are historically volatile, fuel surcharges increase this market's price volatility to a moderate level, detracting from buyers' ability to accurately budget shipping expenditures. Buyer power is also reduced by the high frequency of general rate increases (GRIs) over particular shipping lanes, which mainly affect spot rates but also raise contract renewal rates. Fortunately for buyers, the magnitude of GRIs has been minor over the past three years. For more information, visit IBISWorlds Deep Sea Cargo Transportation Services procurement category market research report page.

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IBISWorld Procurement Report Key Topics

This report is intended to assist buyers of deep sea cargo transportation. This form of transportation involves US flagged vessels and non-US flagged vessels that move cargo. Most shipping routes in this market are international. Buyers purchase shipping capacity on a spot basis (i.e., at current market rates) or through contracts. In this report, buyers are also called shippers and deep sea cargo transport companies are also called carriers. This report does not include the transportation of passengers.

Executive Summary
Pricing Environment
Price Fundamentals
Benchmark Price
Pricing Model
Price Drivers
Recent Price Trend
Price Forecast
Product Characteristics
Product Life Cycle
Total Cost of Ownership
Product Specialization
Substitute Goods
Regulation
Quality Control
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Imports
Competitive Environment
Market Share Concentration
Market Profitability
Switching Costs
Purchasing Process
Buying Basics
Buying Lead Time
Selection Process
Key RFP Elements
Negotiation Questions
Buyer Power Factors
Key Statistics

About IBISWorld Inc.:

IBISWorld is one of the world's leading publishers of business intelligence, specializing in Industry research and Procurement research. Since 1971, IBISWorld has provided thoroughly researched, accurate, and current business information. With an extensive online portfolio valued for its depth and scope, IBISWorlds procurement research reports equip clients with the insight necessary to make better purchasing decisions, faster. Headquartered in Los Angeles, IBISWorld Procurement serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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