The cyclical nature of the maritime sector is well recognized in academic literature and professional journals. Historically, these cycles of shipping boom and bust have remained short, often because of the proclivity of shipowners to overbuild capacity at the slightest indication of market optimism. In a remarkable contrast, the rate recovery that began in 2002 became only stronger in 2003. The head of R. S. Platou, a renowned Norwegian shipbroker, in the company's annual review noted that "shipping markets have never been stronger than they are now." Indeed, 2003 was a stellar year for the global maritime industry in general, and for the shipping community in particular. Freight rates in all markets have been on a rising trend for almost two years now, despite the ongoing geopolitical uncertainties worldwide and the increasing concern with safety and security of global supply chains.
U.S. Merchant Marine and Maritime Industry in Review
By Dr. Shashi Kumar