International manufacturing of delivery containers has fallen considerably as demand for items sank following the easing of pandemic restrictions, leaving the corrugated metal packing containers piled up at main ports.

Figures offered to the Monetary Occasions by Drewry, a maritime analysis consultancy, present that manufacturing of 20-foot equal models — the business’s normal dimension for a container — fell 71 per cent from 1.06mn to 306,000 between the primary quarter of 2022 and the identical interval this yr.

The decline marks a pointy reversal from two years in the past, when container manufacturing boomed in response to a pandemic-induced surge in demand for bodily items which led to a scarcity of the oblong packing containers.

Nevertheless, demand for exports has waned since restrictions eased and economies have reopened, leaving the delivery business with a surplus of containers that threatens to overwhelm ports in China, the place as much as 95 per cent of the world’s packing containers are produced.

AP Møller-Maersk, one of many world’s largest delivery conglomerates, has mentioned it’s halting manufacturing of dry containers till a minimum of 2024, although it mentioned it’d resume constructing 20ft packing containers prior to its bigger 40ft variations because the demand for the previous gave the impression to be extra resilient.

Anne-Sophie Zerlang Karlsen, Maersk’s head of Asia-Pacific buyer supply, instructed the FT the corporate was additionally in search of to promote or scrap extra of its older packing containers to benefit from the glut.

The drop-off in demand has hit producers laborious. Earnings at China Worldwide Marine Containers, one of many nation’s largest producers of the packing containers, plunged 91 per cent yr on yr to Rmb160mn ($23mn) within the first three months of this yr.

Gross sales of ordinary containers dropped 77 per cent throughout the interval, the Shenzhen-headquartered firm mentioned, blaming a “steady decline within the container commerce and an inadequate demand for brand spanking new containers”.

Earnings at Cosco Transport Improvement, the container manufacturing arm of state-owned delivery group Cosco, dipped 71 per cent within the first quarter of this yr to Rmb398mn.

World Commerce Group economists consider export development will stutter during this yr, suggesting that demand for containers would stay weak. The most recent WTO forecasts, out final month, estimate a lift to commerce in items of simply 1.7 per cent this yr — down from 2.7 per cent development in 2022.

Container delivery traces are already having to deal with a extreme decline in earnings following a file interval for earnings throughout Covid-19 lockdowns, when provide chain disruptions — together with the growth in demand for items — drove up the price of delivery.

The growth left delivery teams dashing to top off on new containers after pandemic-induced bottlenecks at many ports led to shortages of packing containers in place to ship items from Asia.

In 2021, international manufacturing reached 7.1mn standard-sized containers, greater than double the output in 2020, in line with Drewry.

Now demand has fallen so vastly that port homeowners within the area face the contemporary downside of getting to search out area for file volumes of unused packing containers.

Stockpiles are actually at file ranges throughout the Asia-Pacific area, Karlsen mentioned, including that “large quantities” of containers had been anticipated to proceed to pile up in ports within the area all through this yr.

She mentioned the “lion’s share” of the models in storage had been 40ft-high dice containers largely used within the Asia-Europe and Asia-US markets, ensuing from weaker demand on these routes. On the similar time, over the previous month there had been a scarcity of 20ft dry containers, which had been in demand in markets corresponding to Latin America and Africa, she added.

The supply of packing containers at Shanghai, the world’s largest container port, has been greater this yr than throughout the spring lockdown of 2022, in line with evaluation agency Container xChange.

Nevertheless, Michael Fitzgerald, deputy chief monetary officer on the Hong Kong-listed delivery group Orient Abroad Container Line, mentioned earlier this month that the glut at Chinese language ports had eased “over the previous few weeks”.