How Is Rising Number of Trade Routes Driving Reefer Container Market Growth?
A number of factors, such as the burgeoning demand for pharmaceutical drugs, rising number of trade routes, and flourishing e-commerce sector, are expected to drive the reefer container market at a CAGR of 8.0% during the forecast period (2020–2030). According to P&S Intelligence, the market size is projected to surge from 3,169.2 thousand twenty-foot equivalent units (TEU) in 2019 to 7,063.3 thousand TEU by 2030. Moreover, the advent of real-time tracking technology has also contributed to the market growth, worldwide.
The increasing number of trade routes is creating an extensive demand for reefer containers across the world. A single trade route includes long-distance arteries, which are further connected to smaller networks of non-commercial and commercial transportation routes. The trade routes are logistical networks of pathways and stoppages that allow transportation of goods to near and distant markets. For instance, in April 2019, a new land–sea freight route was launched to link Indonesia and the Chongqing municipality of southwest China.
In recent years, the increasing number of partnerships and mergers and acquisitions among container players and the surging focus of ship companies on expanding port operations have become key trends in the reefer container market. These strategic measures will help shippers reduce expenses and improve service offerings. For example, in January 2020, Textainer Ltd., a subsidiary of Textainer Group Holdings Ltd., purchased Leased Assets Pool Company Limited (LAPCO). With this acquisition, Textainer Ltd. manages LAPCO’s fleet of intermodal containers, which have a cumulative space of 163,000 TEU.
Globally, the Asia-Pacific (APAC) reefer container market generated the highest revenue in 2019, and it is expected to maintain its lead during the forecast period as well. This can be attributed to the increasing developments in reefer container technology and surging global trade of seaborne perishable reefer cargo. Whereas, the Latin American (LATAM) market is projected to demonstrate the fastest growth in the forecast years, due to the accelerating urbanization rate and rising shipping and transportation activities for food items.
Thus, the mushrooming demand for pharmaceutical drugs and the rising number of trade routes are the major factors contributing to the market growth.
