The Container Abyss – A Great Recession in Maritime Shipping

A wave of container ship oversupply is surging more strongly than global cargo demand. This situation stems from a surge in vessel orders during a period when global imports and manufacturing are under pressure from tariffs, geopolitical instability, and declining consumer demand. This is not a temporary crisis, but a long-term strategic stress test for the maritime shipping industry.

Shipbuilding Boom, But Demand Can't Keep Up
The post-pandemic period saw a massive wave of investment in container fleets as carriers, caught in a frenzy of short-term profits, placed orders for hundreds of new vessels, including mega-ships and clean-fuel vessels. However, the increase in transport capacity quickly outpaced actual market demand. While new vessel orders surpassed a record 4.4 million TEUs in 2024 alone, global shipping demand growth for 2025 is forecasted to remain modest at just 3–4% and potentially lower if global trade continues to be affected by political and financial headwinds.

Freight Rates Swing Between Spikes and Plunges
The container shipping market in 2025 has seen dramatic freight rate fluctuations—soaring rapidly, then plummeting once temporary support factors fade. In Q2, container rates on major routes like Asia–North America and Asia–Europe surged due to concerns over new U.S. tariffs, prompting businesses to accelerate imports before the new duties took effect. But once this “front-loading” wave ended, rates collapsed due to excess vessel capacity.

This instability underscores the market’s dangerous reliance on short-term policy drivers rather than sustainable supply-demand fundamentals. The volatility in freight rates not only impacts carrier profitability but also complicates long-term planning for exporters, importers, and logistics service providers.

Politics and Finance Now Drive Global Cargo Flows
The global container shipping market is increasingly shaped by political decisions and international financial policies, rather than pure market forces.

Simultaneously, conflicts in the Red Sea and tensions in maritime hotspots have forced many routes to detour via longer paths, increasing costs and transit times. However, these effects are temporary and insufficient to absorb the long-standing oversupply. Once the political shocks subside, the underlying supply-demand mismatch resurfaces more sharply, pushing the container shipping sector into a deep and prolonged downturn.

Survival Requires Agility, Transparency, and Technology
To survive in this uncertain environment, carriers must pivot towards more flexible operational strategies instead of clinging to outdated models reliant on scale and high freight rates. Cancelling sailings and reducing service frequency on underperforming routes is a short-term cost-saving measure, but unsustainable without broader fleet restructuring.

Major carriers are beginning to deploy smaller ships on regional routes, linking via transshipment hubs like Colombo and Port Klang to relieve long-haul lanes and optimize cargo flows. Additionally, a shift toward fixed-rate long-term contracts and bundled logistics services is emerging as a way to stabilize revenues. Most crucially, the use of big data and artificial intelligence in demand forecasting, resource allocation, and operational monitoring is becoming a decisive competitive advantage in this fierce market.

Vietnam’s Challenge: Proactively Escaping the Oversupply Spiral
For Vietnam, the global container downturn is not only a challenge but also an opportunity to restructure its national logistics chain in a more sustainable and proactive direction. Leveraging strategic port infrastructure in Cai Mep - Thi Vai, Hai Phong, and the potential for deep-water ports in South Central Vietnam should be tied to plans for upgrading domestic logistics services and enhancing multimodal connectivity to create an integrated transport value chain.

Proactively enhancing competitiveness, improving transparency, and boosting coordination across all logistics segments from carriers and ports to exporters and importers - will form the foundation for Vietnam to avoid getting caught in the global oversupply spiral and gradually establish itself as a regional logistics hub.

By Trung Nguyen