Notes on Shipping
When I traveled the world last year, one thing stood out everywhere I went: containers. From Hong Kong to New York, with a stop in Costa Rica, the same massive container ships dominated the ports—most of them operated by giants like CMA CGM or Hapag-Lloyd. That’s when it hit me: international trade is deeply woven into our daily lives, yet we barely notice it. I started looking into this ecosystem, and what I found was staggering. Ocean shipping isn’t just a piece of global commerce—it is global commerce. About 90% of the world’s goods move by sea, from the clothes we wear to the food we eat and the electronics we rely on.
And this is just the beginning of the story. There are companies thriving in this space, capitalizing on a system the world is fundamentally dependent on. Even with all the talk of deglobalization, trade isn’t going anywhere. Tariffs and protectionist policies won’t stop global commerce—doing so would be an economic disaster, far worse than what we saw during COVID. Our world is too interconnected, built over decades—more likely, generations—into a web of trade that mirrors the natural order of things. Trying to rewind the clock to a single-country, single-economy model would mean tearing everything down. I truly believe there are tremendous opportunities in this space especially because very few investors don’t talk about it because they consider it a cyclical industry.
In this report, I explore how maritime shipping is the invisible backbone of global trade, shaping the movement of goods worldwide while remaining largely unnoticed. I break down the key players and market dynamics, mapping out the intricate web of shipping companies, port operators, and logistics providers that keep this industry running.
I also dive into freight indices and trade indicators, explaining how metrics like the SCFI, CCFI, and CTS serve as powerful macroeconomic signals, revealing trends in global trade and supply chain shifts. A major focus is the green transition, where I analyze how shipping companies are not just adapting to environmental regulations but actively monetizing sustainability through compliance services and new fuel technologies.
Given the industry’s deep connection to geopolitical tensions and economic cycles, I examine whether its so-called cyclicality is a risk—or an overlooked opportunity. Finally, I discuss where the real investment potential lies, looking beyond traditional conglomerates to identify companies that thrive on smart, resilient business models rather than short-term market swings.
An Overview of the Shipping Industry
When I first started investigating this space, I had no idea how intricate it was. I expected a straightforward industry, but the more I dug in, the more I realized how many different players shape this sector. It’s a vast, layered ecosystem, where each company operates in a highly specialized niche.
The shipping process starts with goods being packed into containers at factories or warehouses. Once ready, they are transported to ports and loaded onto massive cargo ships. These vessels follow established global trade routes, connecting key ports worldwide. Upon arrival, containers are unloaded, cleared through customs, and moved inland via trucks or trains to reach their final destination.
This process wouldn’t function without key players at every stage. Shipping companies (carriers) own and operate the massive container ships transporting goods worldwide—powerhouses like Maersk, MSC, and CMA CGM lead the industry. Port operators and terminal operators ensure cargo is handled efficiently, managing port facilities, cranes, and logistics—firms like DP World and Hutchison Ports dominate this space. Freight forwarders and logistics providers act as intermediaries, coordinating shipments to ensure smooth delivery. Finally, customs authorities oversee regulations, enforce tariffs, and maintain security, playing a crucial role in keeping global trade moving.
Shipping Process Mapping
This is the most comprehensive mapping I could find, yet it still barely scratches the surface. It highlights just how intricate and fragmented the maritime shipping ecosystem is. Every company specializes in a specific segment, and very few have managed to integrate the entire value chain into their operations. Despite the numerous intermediaries involved, it remains more profitable for retailers to produce goods overseas and transport them across the world rather than manufacture them locally.
Source: ICE
Huge room for innovation
What makes this industry particularly exciting is its constant evolution and capacity for innovation. At every stage of the supply chain, new technologies and efficiencies are emerging, creating opportunities for disruption. Many have already recognized the untapped niches waiting to be exploited, making maritime shipping a dynamic, ever-changing space—as reflected in the growing number of startups and new players entering the market.
Source: The Maritime Startup Landscape, The Seed Fund
Key shipping indicators (that can also be used as macro indicators)
On another level, if you are interested to follow the maritime shipping movements (these are great macro indicators), these were suggested to me:
CTS: Container Trades Statistics
https://containerstatistics.com
CTS shares export, import and freight prices across regions and routes. Container Trades Statistics (CTS) can be used by investors to track global trade activity, shipping demand, and economic cycles, making it a valuable tool for assessing broader market trends. Since container volumes reflect the movement of goods worldwide, CTS data helps investors gauge the health of global trade, particularly in key sectors like manufacturing, retail, and commodities. There are free data, but you will have to pay to have access to the full database.
Source: Cedar, data platform of CTS
CCFI (China Containerized Freight Index)
https://en.sse.net.cn/indices/ccfinew.jsp
The China Containerized Freight Index (CCFI) tracks the average container shipping rates from Chinese ports to major global trade routes. Published weekly by the Shanghai Shipping Exchange, it reflects both spot (short term) and contract (long term) rates, providing a key indicator of global trade activity. A rising CCFI signals strong demand for shipping, while a decline suggests weaker demand or excess capacity. Unlike the Shanghai Containerized Freight Index (SCFI), which focuses only on spot rates, the CCFI offers a broader view of the market. It is widely used by shipping companies, importers, and analysts to gauge freight market trends and economic conditions. During COVID-19, the CCFI surged to record highs as soaring demand, port congestion, and supply chain disruptions drove shipping rates to unprecedented levels. The database is free for YoY data.
Shanghai Containerized Freight Index (SCFI)
https://en.sse.net.cn/indices/scfinew.jsp
The Shanghai Containerized Freight Index (SCFI) is a widely used benchmark that tracks spot freight rates for container shipping from Shanghai to major global ports. Published weekly by the Shanghai Shipping Exchange (SSE), it reflects short-term market conditions and is a key indicator of shipping costs and global trade demand.
Alphaliner
https://alphaliner.axsmarine.com/PublicTop100
It provides specialized data on shipping line, fleet and capacity and trade routes (among other). Alphaliner is a leading maritime intelligence and analytics platform specializing in container shipping data, market analysis, and fleet tracking. It provides critical insights to industry professionals, investors, and policymakers, helping them track market trends and competitive dynamics in global shipping.
They are very active on social media so it is easy to grab free insights and charts (like below). Some data are free on their website but the major part of it is paying.
Source: Alpha Liner
The importance of sea alliances
Alliances in maritime shipping are crucial for cost efficiency, operational flexibility, and global market coverage. Given the industry’s capital-intensive nature, forming strategic partnerships allows shipping companies to share vessel capacity, optimize routes, and reduce operating costs while maintaining a competitive edge. One of the main reasons for alliances is economies of scale—by pooling resources, shipping lines can operate larger vessels and fill them more efficiently, reducing per-unit transport costs. This is particularly important in container shipping, where fuel expenses, port fees, and vessel utilization directly impact profitability.
Alliances also enhance network reach by allowing companies to offer more destinations without needing to operate in every trade lane. This helps carriers provide reliable and frequent services across global shipping routes, improving connectivity for shippers. From a competitive standpoint, alliances help mitigate market volatility by balancing supply and demand. In downturns, they allow for capacity adjustments that prevent excessive price wars, stabilizing freight rates.
However, these partnerships also attract regulatory scrutiny, as they can lead to market concentration and reduced competition. Authorities, particularly in the EU, U.S., and China, monitor alliances to ensure they do not create monopolistic practices that disadvantage cargo owners.
Currently, three dominant alliances control most of the global container shipping capacity:
- 2M Alliance (Maersk & MSC) – Ending in 2025
- Ocean Alliance (CMA CGM, COSCO, Evergreen, OOCL)
- THE Alliance (Hapag-Lloyd, ONE, Yang Ming, HMM)
These alliances dictate much of the global trade flow, making them critical indicators for investors, regulators, and industry players.
Can they be compared to Joint Ventures (JVs)?
Maritime shipping alliances share similarities with joint ventures (JVs) but are fundamentally different in structure and legal commitment. Like JVs, alliances are strategic partnerships where shipping companies collaborate to achieve common goals, such as cost reduction, route optimization, and fleet efficiency. They allow members to share vessel capacity, coordinate schedules, and improve service coverage without having to individually operate on every route. This cooperation enables economies of scale and helps stabilize the industry by managing supply and demand.
However, unlike traditional joint ventures, shipping alliances do not involve equity ownership or the creation of a separate legal entity. Instead, they are operational agreements, meaning each member retains its own independence while cooperating on shared services. In contrast, a JV typically requires financial investment, shared risks, and profits, often forming a new company with joint management. Another key difference is the flexibility of alliances—they are typically structured as time-limited agreements, often renegotiated or dissolved based on market conditions.
Source: Alpha Liner
Insights from the Ground
I originally chose Greece as a focal point for my research after flagging Euroseas, a company operating in the ocean shipping industry. What caught my attention was its insane returns on investment over the past few years. As I dug deeper, it became clear that these extraordinary gains were largely driven by temporary macroeconomic factors—the COVID-19 crisis, subsequent supply chain disruptions, and the war in Ukraine. These events triggered a surge in freight rates, fueled by heightened uncertainty and logistical bottlenecks.
A Macro-Driven Industry
The profitability of shipping companies is heavily tied to capex cycles and geopolitical tensions. The more international turmoil, the higher the risks—and in this industry, higher risk often means higher freight rates and better margins. In a way, investing in ocean shipping is a macro bet on global uncertainty. However, after speaking with industry contacts, I quickly realized that expectations for the coming years are much less optimistic. Most players anticipate a decline in profitability, as the confluence of COVID-related disruptions, supply chain congestion, and geopolitical shocks was largely a one-off event. Revenue is expected to decline across the sector, and the general sentiment is pessimistic.
That being said, this industry is notoriously complex and cyclical. While shipping typically suffers during geopolitical conflicts, the current wave of international tensions could keep freight rates elevated for longer than expected. If global uncertainty persists, normalization may not come as quickly as many anticipate.
The Green Transition: A New Revenue Driver
Another key trend emerged from conversations with experts and an international shipping conference in Hong Kong: the industry is under intense pressure to comply with green regulations. But rather than resisting, shipping companies are capitalizing on the green economy by offering an increasing number of value-added services (VAS) tied to sustainability. Much like asset management, they now charge for certification compliance, decarbonization strategies, and supply chain greening initiatives—essentially monetizing regulation.
One of the most frequently mentioned trends was LNG-powered ships, with more vessels now shifting to gas propulsion. However, the real margin opportunity lies in green compliance services. I was surprised to hear CEOs of large shipping companies actively advocating for more regulations, which sounded a lot like lobbying for their own benefit. If even the industry itself is pushing for stricter green policies, then it seems inevitable that more regulations will be introduced—creating even stronger incentives for compliance-based revenue models. I’m already exploring ways to play this theme in public markets, as it’s clearly an area worth investigating.
Regulatory Pressure & the Fight Against the Dark Fleet
Another factor driving this regulatory push is the effort to banish the so-called dark fleet from international waters. These non-compliant tankers continue operating despite sanctions and safety regulations, accounting for roughly 10% of tankers trading globally. While quantifying the exact financial impact is difficult, their presence distorts competition and poses significant environmental and security risks. The push for stricter enforcement could reshape the industry, further reinforcing the need for compliance-related services and tracking solutions.
Shipping: A Long-Term Capital Game
A major takeaway from my conversations was the long-term nature of the shipping industry. It requires massive upfront investments into costly assets like container ships, making capital allocation a crucial strategic decision. The market dynamics are shaped by a web of interconnected players, each with its own role, as discussed earlier.
Key Markets & Industry Leaders
Several emerging maritime hubs are rising in importance, including Indonesia, Vietnam, China, Poland, Brazil, Mexico, and the French overseas territories (Dom Tom). Among the companies mentioned by industry insiders, DP World stood out. A subsidiary of Dubai World, it owns and operates multiple ports across the globe, though it was delisted in 2020.
Since the COVID crisis, MSC (the Swiss-Italian carrier) has strengthened its position in the global shipping landscape, joining the traditional giants Maersk, Hapag-Lloyd, and CMA CGM as dominant forces in the industry. With shifting trade dynamics and regulatory pressures, the next phase of growth in shipping will likely be driven by those who can navigate the intersection of capital investment, compliance, and global trade trends.
Excited to see what’s next
To conclude, this sector has piqued my curiosity, and I intend to keep investigating how to play the theme strategically. Rather than betting on large conglomerates that are heavily exposed to geopolitical and regulatory complexities, I’m more interested in companies that operate within smart, win-win ecosystems, have a strong culture, and business models resilient to market cycles. The goal is to find high-quality operators that can thrive regardless of short-term fluctuations, rather than those whose success is dictated by external shocks.
Explanatory videos: