Container Market Report March 2013

March 11, 2013 is the 2nd anniversary of the Great East Japan earthquake. The disaster-stricken area has been in the half way of recovery and reconstruction. There are still over 310,000 people who have been evacuated from the Tsunami stricken areas. A heap of debris has been disposed of 44%. It was 18 years ago that The Hanshin-Awaji Great Earthquake hit in Kobe area. It was Jan 17, 1995. The death toll was over 6,000 people. The number of the evacuees was over 310,000. It was said that the amount of damage was about 10 trillion yen. The government has never learnt that experience. The port of Kobe that was No.1 container handling in Japan had never recovered its prestige after the earthquake. The manufacturing industry in Kobe area had not all been back as they were. Now the port of Kobe is ranked the last of the 5 major ports in Japan. The cities and the ports that have been prosperous have a necessary reason to be successful as they are. They have to change their figures if they lose the factor.

What is the need to the disaster-stricken area is that everything should leave to the people who used to live and the local business sectors if the government or the municipality could not make a grand plan for the future in the disaster-stricken area. I presume that the concrete plan for recovery would appear in due course if government gets them work it by themselves. It will encourage the local business sectors to hire as many workers as possible which at the same time will give people a dream for their future.

As I pointed it out one year ago in my report I wonder why the container would not be utilized more in the disaster-stricken area. I could not find anything more useful than the container. More than 30 million teu containers are moving around in the world. They have been delivered door to door with cargo by ship, truck, railroad and airplane. For example, it would be 3 million teu containers if 10% of them would be retired a year. Besides you can see them anywhere and you can buy them at the reasonable price. It could be loaded 30 tons per 20f container and stack at 7~9 layers. The container would be excellent. However, in Japan the container could not be utilized freely for domestic use. Government will require it to meet the Construction Standard Act. Government will stress on safety for using JIS material, welding made in JIS approved factory but the container has made in “Rahmen” structure. So why does it need them for the container made by International Organization for Standardization (ISO)? It sounds like invisible regulation. If the container is approved in use in the disaster-stricken areas as the exceptional case for 5 ~ 10 years it should have been a bit different from the present situation. The container should have changed to a miracle box. Anyway, recovery of the disaster-stricken areas would be expected as quickly as possible.

USA economy has renewed the highest record in Dow Jones Industrial Average for the first time in 5 years and 5 months. The new car sale has increased 3.7% up to 1.19 million cars from a year ago and it would be 15 million cars level in annual rate. 15 million cars level in annual rate has been recorded for 4 months on end. The number of employment of non-agriculture has increased 236,000 people from the previous month.
The unemployment ratio has been reduced to 7.7% in Feb. It is also promising to see the housing price going up. It would be a matter of time for strong USA to revive as before. Moreover, USA will be expected to be a LNG export country for the shale gas from 2016 after exploiting it.

In response to the strong USA Japanese yen has recorded $1.00=JPY96, the weak yen and strong US dollar for the first time in 3 years and 7 months and it would not be denied to be $1.00=JPY100 level. In the meantime, Nikkei Stock Average has fetched JPY12,349 on March 11 for the first time in 4.5 years. The investment fund from Asia has been pushing up the price of land and the condominium in Tokyo. To overcome deflation by the target of raising 2% of prices, it would be nice to see a promising trend of raising wages in a spring labor offensive. Is it by “Abenomics” effect? I wish the whole Japanese could have a bright future with hope. USA materialized the shale gas revolution by inventing the technology of extracting the natural gas from the shale layers in 3,000m underground. Japan has recently developed the technology of extracting the natural gas from the methane hydrate. If we could turn it to practical use it will bring Japan an epoch-making energy revolution. It is said that the methane hydrate would exist equal to 100 years of annual use in Japan.

Each shipping line has been starting to secure containers from the end of the last year. Shipping lines who have enough money will buy containers by themselves and ones who could not afford will depend on leasing. Leasing companies have already ordered a large number of containers by speculation as the previous year. However, they have concentrated on Reefer containers which are quite attractive because of high freight rate. Shifting the attention to shipping lines’ movement they seem to have been anticipating the conclusion of FTA, EPA among countries and the members of TPP which would ensure the brisk cargo movement in the trade zone. It would be the key of earning the profit if they could catch up the flow of the cargo movement. One of the major leasing companies expects that total new container production in 2013 would be 2.7 million teu which will increase 8% from 2.5 million teu of 2012. I am confident that the year of 2013 would be the bright year to the shipping lines.

20f Sliding Door Containers used with FBC’s patent would be exhibited at the end of March after bring to Japan from China factory. It is the first time for the Sliding Door Containers to be put for practical use. The doors of the Sliding Door Container are moved along to the guide pole put at the back of the top side rail so it doesn’t look outside. This is totally different from the conventional side open container. The door of the Sliding Door Container stands still at the place where it is stopped. It will easily move if you pull it by hand softly so it is very safety. There is no risk of swinging by wind freely. It would also be free from the door trouble which causes each door hardly close properly due to the door weight by itself for long usage. Besides the hinges of FBC Sliding Door Containers are located at the back of the door so that container could not be opened by breaking the hinges. So Sliding Door Container is so safe for cargo.

In view of loading and unloading cargo the side open container is the best. Container opening at the rear doors has been actually troublesome in loading and unloading cargo through the limited door space while the side open container is more convenient in working safely as it looks like the whole side wall open and you can use 2 forklifts as necessary. Containers with the double doors at the rear just pursue the greatest common divisor in use worldwide by minimizing the production cost. Considering loading and unloading cargo safely for short hours the side open container is more advantageous. The production cost of the side open container would be higher than the conventional container with the double doors. You could recover the cost difference for short period of time. I am confident that FBC patented Sliding Door Container would add higher value to the side door open containers.