Economist, historian, journalist, and former author, Mark Levinson is known for his work on global trade, productivity, transportation policy, the changing forces behind globalization, and his groundbreaking books. box and Out of the box related to our industry..
Levinson’s work has shaped the way generations of professionals understand containerization and its profound impact on the modern world economy.
In this edition of Executive Insights, I spoke with Levinson about demographic changes, large ships, digitization and the structural pressures shaping the future of the shipping industry.
SFR: Mark, for the few who may be new to your work, could you start by giving a brief introduction about yourself?
ML: I describe myself as an independent historian and economist based in Washington, DC. Newsweek and Economist.
After that, I worked as an economist and advised the US Congress on transportation and industrial issues for several years.
Over the years, I have written books related to distribution, transportation, and the broader economic forces that shape global trade. I continue to follow this industry closely because it has so many ramifications for how we live and work.
SFR: Your book box It remains one of the most influential works in the field of containerization. How has the industry evolved since you first published it in 2006?
ML: When I wrote the book, a 6,000 TEU ship was considered large. Most ships were in the 1200-2000 TEU range.
The industry changed very quickly, especially with the advent of large ships. This shift prompted me to revise the book in 2016 to further illustrate how these much larger ships are reshaping ports, alliances and the shipping economy.
My perspective on containerization is slightly different from traditional maritime analysis. I look at it from the perspective of international trade and economics, looking at how containerization has transformed supply chains and the global economy, not just how ships themselves have evolved.
SFR: In your recent work, you argue that globalization is shifting from goods to services, ideas, and intangibles. What should transportation professionals prepare for?
ML: For about 20 years, global merchandise trade grew twice as fast as global GDP. This was mainly due to population growth and increased consumption of physical goods.
Today we are witnessing structural changes. Populations are aging, fertility rates are below replacement in many countries, and demand for “stuff” is decreasing as people age.
In terms of technology, software-based machines are more durable and require fewer physical upgrades. Electric vehicles contain thousands of fewer parts than internal combustion vehicles, suppressing a major part of the container business.
All these trends slow down the growth of goods trade. Commodities will remain important, but the rapid expansion we once took for granted is unlikely to return.
SFR: You have suggested that infrastructure development needs to be more calculated, and that “more is not always better…” What ports and investors need to keep in mind today.
ML: Many ports are political and naturally optimistic about growth. Local communities want expansion because ports bring jobs and economic activity.
But when everyone expands at once, we end up with far more capacity than we need. Some ports around the world have seen a decline in traffic, not because of poor management, but simply because fewer physical items are being moved internationally.
Ports also compete more fiercely than many governments realize. For example, in the United States, Los Angeles competes directly with New York-New Jersey because shippers can choose multiple routes. Excess capacity becomes a real risk.
This is why private capital plays an important role. Private investors are more skeptical and focus more on returns. They raise tougher questions about whether a new terminal or pier will actually pay for itself and on what timeline.
SFR: You’ve written extensively about productivity challenges. Where do you see the most important issues in transportation and logistics?
ML: Excess capacity in ocean shipping is a major productivity problem. When ships run half full, resources are wasted. The order book suggests we may be entering another period of excess capacity.
Inside ports, productivity issues range from crane lifts per hour to the rate at which boxes can be unloaded inside. Digitization should help, but progress has been slower than expected. All stakeholders agree, in theory, that greater digital interoperability is needed. But many are unwilling to give up control of data or customer relationships.
Digitizing the supply chain is proving to be much more difficult than anticipated. Progress has been made and the industry deserves credit, but much work remains.
SFR: You have seen global trade from several points of view, including finance and politics. Are there regulatory or structural trends that industry players are underestimating?
ML: One important trend was the unintended rise of contract shipping after deregulation in the 1980s and 1990s. No one expected that shipping, rail transport, freight and even ocean shipping would shift so strongly towards long-term contracts.
Today, however, most cargoes are moved under contractual arrangements. The cash market is much smaller than it used to be. This shift has changed global trade.
Another trend is increasing vertical integration of logistics companies. Companies that once operated ships, or railroads, or were freight forwarders now provide logistics solutions.
But I’m not convinced that shippers really want one company to manage everything. With geopolitical risk and supply chain uncertainty rising, many shippers want discretion, not dependency. Whether this consolidation process will last or not remains to be seen.
SFR: Finally, Mark, any final thoughts on where the industry should focus its attention in the coming years?
ML: Global trade is being reshaped by slow, structural forces—demography, technology, investment patterns, and the evolving nature of consumption. Transportation professionals must look beyond short-term shocks and recognize these deeper trends.
Commodity trade is not going away, but its growth engine is not what it used to be. Understanding these changes is essential for planning the next generation supply chain.
Watch the full interview here https://youtu.be/ZPOJU5xf8O8
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