In 2021, almost all people and companies are trying to restore their economies that were affected by the pandemic. In the global business, shipping and transportation have a significant role. The shipping and freight forwarding are seeing steady growth in 2021 and are expected to grow more.
Are you interested to learn more about shipping and freight forwarding in 2021? If so, then scroll down to get detailed information about them.
What Is Shipping?
Let’s start with the basics. Shipping is simply the transportation of products. Both commercial and non-commercial shipping services do exist. At present, shipping has numerous transport means. In general, the act of carriage of shipment from one region to another is known as shipping.
In shipping, multiple types of vessels are there to transmit the shipment across the world. Some of the most common are typical vessels, dry bulk vehicles, ro-ro ships, oil vessels, container carriers, and many more. Shipping comprises scheduling and recognizing the most efficient trade ways across the world. It also deals with the total quantity of freight accessible on those routes.
The ships are managed by shipping lines for commercial profit. Besides that, a normal shipping line will contain several sections like planning, sales, finance, documentation, ship operations, and more.
What Is Freight Forwarding?
Freight forwarding is the collaboration and freight of products from one area to another. The freight forwarding of marine, air, road, or rail, can be done through single or several vehicles. Freight forwarders will work together with many shipping lines both nationally and internationally.
In general, freight forwarding companies regulate cargo for individuals or firms. They will receive goods from the creator or manufacturing unit and deliver them to the customers and market. Freight forwarding includes single or more transport to send the products from one nation to another.
Freight forwarding comprises tactical logistics planning and implementation of the global activity of goods. To be precise, a freight forwarder would perform freight rate agreements and track the carrier. FBA freight forwarders such as FBABEE offer sea shipping, express, FNSKU labeling, air shipping, free storage, and repacking services.
Essential Information About Shipping And Freight Forwarding In 2021
According to a 2021 latest report, the global shipping and freight forwarding industry is in the recovery stage after the reduction in 2020 due to the pandemic. But, the current market dynamics continue to be uneven with insufficient capacity. Plus, the elevated freight rates demonstrate the tough market for shippers and the high chances for freight forwarders to maintain huge margins.
The shipping and freight forwarding industry is predicted to make a strong comeback with advancements of 11.6 percent in 2021. Besides that, the expected CAGR from 2020 to 2025 is 5 percent.
After the pandemic started, the Air and sea freight rates have become very unstable. In 2020, the international freight forwarding industry experienced an 8.7 percent decline. With that, it recorded its worst year because of the financial crisis. The sea freight forwarding market faced a fall of 3.8 percent in 2020. Besides that, air freight forwarding remained the worst hit with a 12.3 percent decline.
In 2021, the sea shipping and freight forwarding industry is set to thrive at 7.6 percent. It is expected to have a CAGR of 4.5 percent from 2020 to 2025. In 2021, the shipping and air freight forwarding market is foreseen to rise at 14.9 percent. The estimated CAGR of airfreight forwarding from 2020 to 2025 is 5.4 percent.
Another report reveals that despite the upheaval to the air freight industry, the top 20 freight forwarding firms have considerably boosted their share of entire volumes. In 2019, that share was 65.05 percent, and it has increased to 74.89 percent in 2020.
International Federation of Freight Forwarders Association (FIATA)
The shipping and freight forwarding companies across the world are displayed by the International Federation of Freight Forwarders Association (FIATA). The FIATA association includes 109 association partners and around 5,500 individual memberships.
The primary goals of FIATA are to unify, represent, stimulate, safeguard, standardize, and help the freight forwarding union across the globe. The organization fulfills this by actively connecting with the World Trade Organization (WTO). It also engages with other global trade and carrier organizations, including different governments.
Many governments and prominent private bodies of several countries recognize FIATA. It is an advisor to committees, such as the United Nations Commission on International Trade Laws, UNESC (United Nations Economic and Social Council), and many more. Plus, FIATA gives vocational training to freight forwarders. With that, the freight forwarders can attain their professional duties correctly and in a systematic manner.
The FIATA was established in 1926 in Vienna, Austria. The headquarters of the FIATA association is located in Geneva, Switzerland. The crucial programs of the FIATA association include:
- Online registry of digital identity profile of members
- Standardization of trade documents
The Services Of The Shipping And Freight Forwarding
The services given by shipping and freight forwarding companies include:
- Making the agreement of freight taxes with the ocean vehicle in place of the shipper
- Reserving the freight space onboard ocean containers
- Organizing carrier and labor
- Arranging shipment insurance
- Inland transport of the products from the client’s storage house to the harbor
- Momentary storage of the goods (if needed)
- Freight consolidation
- Preparing the shipping, customs documentation, and export documents.
The freight forwarders need to cooperate with several government agents. The agreement will vary based on the category of freight that is going to be exported, such as restricted items, specific kinds of foods, and more.
The shipping and freight forwarding firms need to be aware of the relevant laws, rules, and regulations existing in the importing nation. Hence, they must maintain a decent communication network with the governments and other relevant councils of the importing and exporting countries.
In this article, we included the details and essential information about shipping and freight forwarding in 2021. It can be seen clearly that the shipping and freight forwarding industry will gain more growth in the upcoming years.