People around the world depend on containers

Published on 09 August 2018

Billions of people around the world depend on containers for a steady supply of food and goods. Containers are the building blocks of global trade, connecting producers and consumers across continents.

Category: News articles

The computer you’re using to read this, the food you eat, the shoes on your feet — most of these things were produced in one or more different countries and transported to you using a shipping container.


The shipping container’s simplicity is its strength. Over the past 60 years this unremarkable metal box has overhauled global industry and transformed world trade, kickstarting the modern age of consumerism.

The first container appeared in America in 1955, the brainchild of trucking company owner Malcolm McLean. For years, he had been wondering how he could get a truck’s entire cargo onto a ship as quickly as possible. When he started working with engineer Keith Tantlinger, the shipping container was born, and in April 1956 the first container was loaded onto a converted World War II oil tanker, the SS Ideal X.

The container has been more of a driver of globalisation than all trade agreements in the past 50 years,"

according to The Economist.

Economies of scale

McLean’s dream was to achieve economies of scale by lifting a truck’s entire trailer onto a ship for onward transportation.

His prediction proved to be accurate beyond his wildest dreams. The new “intermodal” system saved an enormous amount of time and effort at the loading and unloading stage of cargo.

I just knew that if they picked up forty bales at once, it would be a lot cheaper than picking them up one at a time.


The new containers also delivered huge safety and security benefits. Shipments of whisky used to suffer from substantial breakage and theft. Shipping containers slashed these losses by up to 90%

Before containers, 30% of a product’s price used to be accounted for by freight costs. Now, that figure is less than 1%. 

Standardisation and globalisation

From the outset, the widespread adoption of shipping containers was greatly accelerated by its standardization. Because the patents and designs for the containers were given to the industry, other trucking companies across America were able copy and adopt the technology quickly and cheaply.

Over the years that followed the shipping container’s introduction, American ships, ports, trucks and trains were adapted to be able to carry the new invention, and McLean launched his Sea-Land Service fleet of container ships.

By the time Sea-Land made its first trans-Atlantic journey in 1966, the shipping container was on its way to becoming a global standard.

In December 1999, Maersk bought Sea-Land’s international services and the right to the "Sea-Land" name, later renaming the company Maersk Line in 2006.

The building blocks of global trade

According to The Economist, “the container has been more of a driver of globalisation than all trade agreements in the past 50 years together."

Now, nearly than 5,000 container vessels transport over 34 million containers (TEU) around the world, every year. 

Almost anything you want to move, there’s a suitable container for it. From standard dry cargo containers for hardware and consumer goods, to refrigerated “reefer” containers for transporting meat, fruit and vegetables, dairy products, chemicals, pharmaceuticals, and even flowers, to liquid bulk tank containers.

Maersk Container Industry has made a business of making world trade more efficient, giving customers a powerful combination of innovation, quality, and reliability. Their Star Cool reefer containers are the world's most energy efficient, with a controlled atmosphere (CA) system that can help to keep the produce fresh for longer during transport, thereby increasing the distance it can be exported. In Mexico, for example, exports of avocados to Asian markets have increased thanks to the improved quality and reliability of refrigeration.

In the 60 years since the introduction of the shipping container, an entire industry has grown up around the containers themselves. As well the trucks, trains and vessels needed to move them, there are terminals that process the boxes, and complex logistics processes and IT systems that co-ordinate the worldwide flow of transport from producer to consumer, making sure that products arrive in the right place, and the right time.


The first ever container ship was a converted World War II tanker, the SS Ideal X. It carried 58 containers on its maiden voyage from Port Newark to Houston in 1956.

Since then, Maersk Line has repeatedly broken the industry capacity record, with four successive vessel designs that claimed the title of “world’s largest container ship”.

The company’s new “Triple-E” is the longest, widest container vessel possible based on current port restrictions. It’s also the largest vessel of any kind in operation today, with a capacity of 18,340 TEU.

People are fascinated by these gigantic vessels, which at almost 400m long and 60m wide are so large that it would only take four Triple-E class vessels to transport the entire contents of the grand Cheops pyramid. There’s even a small but passionate group of people who gather near ports and shipping channels to spot container vessels coming and going, and to speculate about the cargo the ships are carrying.

In container shipping, bigger is almost always better. Economically and environmentally, the biggest vessel leaves the smallest footprint. The Triple-E is designed for Efficiency, Economy of scale and Environmentally improved. In fact, Maersk Line’s new vessel will cut carbon dioxide emissions by more than 50% for every container it moves, compared to the industry average on the Asia-Europe trade. The Triple-E’s energy efficiency can be explained by its two slow-running engines, twin propellers and waste heat recovery system. The hull design was also modified, moving the bridge forwards and the engines back to enlarge the available space for carrying containers.

Modern container ships haven’t just grown in size. Onboard equipment and conditions are now more sophisticated and much safer. The safety of employees remains the number one workplace priority at Maersk, where the focus is on driving down the frequency of incidents on the principle that no injury is acceptable.


With 90% of global trade being moved by ship, ports are a critical link in the global supply chain. Economic growth depends upon access to global markets through efficient ports and terminals. Modern ports and cargo handling infrastructure connect inland traffic to maritime transport, keeping global transport and trade flowing smoothly and efficiently.

In very simple terms, a terminal’s job is to transfer containers from one mode of transport to another. Whether it’s unloading incoming vessels and placing their cargo on to trucks and trains for onward distribution, or receiving containers from the inland transport network and loading them onto container ships to be exported, there are always containers that need to be moved.

As well as physically moving the containers themselves, terminals also run complex IT systems to manage the flow of goods through the port. These systems are responsible for automating the cranes that load and unload ships, maintaining a smooth flow of containers, and keeping expensive delays to a minimum. In 2012, the world’s busiest container terminal — the Chinese port of Shanghai — boasted an annual throughput of a staggering 32,530,000 TEUs. That’s enough containers to reach round the earth five times every year.

The better this process can flow, the less time and space needs to be dedicated to storing containers before moving them again — so an efficient terminal can save manufacturers and retailers money. 

Customs authorities also use IT systems to fight smuggling. Software helps them identify the containers that are most likely to be used for smuggling counterfeit merchandise or contraband into or out of a country. The system alerts officers to check containers travelling along routes that they know are used to transport illicit cargo, and scan them using x-ray machines.

Before containerization, docks would have employed thousands of men to load and unload cargo by hand. It was tough, time consuming work. Modern container terminals only need a few hundred workers to operate the cranes, secure the containers, and manage the IT systems.

The unique identifying number on a container is used by ship captains, crews, coastguards, dock supervisors, customs officers and warehouse managers to identify who owns the container, who is using the container to ship goods and even track the container's whereabouts anywhere in the world.

Infrastructure and logistics

Today’s global economy relies more than ever on international logistics chains to connect markets, people, businesses and countries. The magic of the global supply chains that connect producers on one side of the planet to consumers on the other is how invisible the whole process appears to be.

Infrastructure investment is an essential component of national and regional economies. Good road and rail links give producers reliable access to ports, opening up international markets for their products, and providing an entry point to the global economy.

Inadequate or substandard infrastructure can introduce delays and uncertainty into supply chains. This makes it more difficult to plan and execute a smooth flow of traffic, especially when problems arise. The end result is that products become more expensive, in order to cover the costs of additional transport and warehousing. These costs and the complications involved can be enough to prevent small businesses from attempting to enter the global marketplace.

According to a World Economic Forum report, “improved transport infrastructure helps create new business opportunities, connect producers and consumers, and reduce time to market. It is a critical driver of human development, competitiveness and growth.

Specialists in customised freight forwarding and supply chain solution


As well as physical infrastructure like roads and rail, stable and effective communications infrastructure is also critically important to manage and keep track of the logistics flow. ICT system crashes can cause delays in the same way as road traffic accidents upset the smooth flow of traffic. Damco is an industry-leading specialist in managing global supply chains. Their understanding of complex supply chains helps to improve control and reduce costs. Supply chains that run smoothly mean that producers and retailers can work on a “just in time” basis, and rely less on stockpiles and warehouses. This “asset-light” approach saves money, and also makes it easier to respond to changes in the supply chain.

As well as physical infrastructure like roads and rail, stable and effective communications infrastructure is also critically important to manage and keep track of the logistics flow. ICT system crashes can cause delays in the same way as road traffic accidents upset the smooth flow of traffic. Damco is an industry-leading specialist in managing global supply chains. Their understanding of complex supply chains helps to improve control and reduce costs. Supply chains that run smoothly mean that producers and retailers can work on a “just in time” basis, and rely less on stockpiles and warehouses. This “asset-light” approach saves money, and also makes it easier to respond to changes in the supply chain.


Shipping containers can deliver speed, efficiency, and security. A well-run logistics process can simplify complex global supply chains, and make substantial cost savings by reducing capital requirements, and maximising control.

The combined benefits of these technologies have made it possible for the logistics industry to adopt the Just-In-Time system pioneered in the car manufacturing industry. The Just In Time philosophy is that stored inventory is a waste of resources. Instead, the focus is on having “the right material, at the right time, at the right place, and in the exact amount”. When applied to supply chains, this principle makes it possible to minimize the number of warehouses on the route from producer to customer — as long as the container carrier can be relied upon to deliver on time.

This also delivers benefits to factories that assemble a finished product from a variety of parts and components. Rather than store all the parts needed to manufacture the finished product on site, factories can now use containers as a kind of floating conveyor belt to bring in the parts they need as and when they need them. This frees up floor space previously dedicated to storage, which can be used to expand production capacity.

This kind of decentralised manufacturing makes great economic sense for electronics manufacturers that source components using an international supply chain that stretches over more than five countries. Low transportation costs means they are free to source their parts from anywhere in the world — wherever they can get the best goods for the best price.

Retailers like supermarkets use a similar principle to minimise the amount of capital tied up in stored inventory. Working with sophisticated software that predicts consumer demand, they use container-based supply chains to bring in just the right amount of stock at the right time. The incredibly low transport costs achieved by containers make this system a very cost-effective way of doing business.

The overall impact on global trade is of dramatically improved efficiency, and accelerated world trade on a massively increased scale.

For consumers, containers and global supply chains have brought about a high street revolution, which has made previously unaffordable products into commodities. Modern shoppers have a much wider choice of goods, available at much better value prices.

The future belongs to those who prepare for it today”

This was A.P. Møller’s guiding principle when he founded the Maersk group.


Most people are completely unaware of the complicated processes involved in transporting the food they eat and the goods they buy from the producer to the high street. The following example illustrates the journey a lime takes from tree to table.

 This is a simple example. Other products like clothing or electronics have more complex global supply chains that contain more links, which makes managing the logistics considerably more challenging.

The above supply chain represents the journey of a single product, but brands typically market product lines that contain multiple items. With multiple brands producing the same type of product, you can begin to imagine the sheer scale and complexity of the supply chains currently in operation around the world.

It is exactly this type of complexity that companies like Damco and Maersk Line are experts in managing. They take care of the logistics details that connect each step of the supply chain, freeing manufacturers and retailers to focus on what they do best.


Trade has always been about more than simply buying and selling goods. From ancient trade routes like the Amber Road in the 16th century BC, the Silk Road that connected Asia to the Mediterranean since 200 BC, to the spice trade at the turn of the 18th century, technologies, religions, philosophies, and cultures have travelled alongside merchandise.

From the mid-19th century, the growth in transport infrastructure, especially rail, improved trade connections and led to a surge in productivity, so much so that by the turn of the 20th century, the ratio of exported goods to total goods was higher than it is today.

Trade in the 20th century was hampered by the First World War. The major trend of the first half of the century was the end of European dominance of global trade, as the USA and Japan took a more prominent role. The discovery and refinement of oil during this period would also prove to be fundamental to the future of world trade.

The Second World War affected trade even harder than the First World War, but by the mid 1950s, the introduction of the shipping container led to an explosion in trade volumes, and laid the foundations for the truly global state of modern trade.

Modern trade

In the 21st century, international supply chains have transformed the global economy by connecting trade, investment, and services. This has been accompanied by the ongoing revolution in information and communication technologies, which has made it possible to manage the complex challenges of coordinating logistics on a global scale.

Access to global trade is now easier than ever before, but local institutions, systems and processes could still benefit from modernisation or standardisation to help lower barriers to entry. Transport infrastructure, and border control and management are two of the most important areas where relatively simple improvements could open the door for small producers to play a role in global value chains.

One of the biggest challenges faced by importers and exporters is the non-standardised system of customs documentation and procedures worldwide. At a basic level, this results in inefficiency — some ports can require dozens of documents to be completed for every container. The sheer quantity of documentation required can be enough to discourage small businesses from entering the global market.

The interconnected global economy depends on reliable, on time delivery of goods and services in order to run smoothly and minimize costly delays. High quality infrastructure facilitates trade and production efficiencies, playing a major role in a country’s economic growth and global competitiveness.

Free trade agreements (FTAs) are another way to stimulate international trade between countries with complementary economic structures. FTAs are reciprocal agreements that eliminate tariffs, import quotas, and preferences on goods and services traded between the signatory countries. The number of regional trade agreements has been growing rapidly since the early 1990s, and there are now over 350 of them in force.

Enabling trade drives economic growth, and can help deliver social benefits. Maersk's Sustainability Report details the social and environmental impacts global logistics companies can deliver as enablers of international trade.

Sustainable trade

Most large corporations today invest time and resources in understanding and addressing their sustainability impacts and challenges: be they resource constraints, workplace safety, corruption or something else.

Addressing the negative impacts of transportation and logistics has become a higher priority than before, and more and more customers are demanding sustainable shipping solutions. This led a group of forward-looking businesses including Wal-Mart, IKEA and Nike to set up the Clean Cargo Working Group. The CCWG developed a standardized, industry-supported CO calculation methodology for the container shipping industry, and over the last five years, this has become the standard way of measuring environmental impacts in the container shipping industry.

Maersk Line is working to cut CO emissions by 40% per container-kilometre by 2020, compared to the 2007 baseline. In order to lower the impact of shipping, the company has been deploying new, more energy efficient vessels, retrofitting older ships, introducing pioneering new fuel saving initiatives like slow steaming, and optimizing network planning.

Of course, sustainability goes beyond just carbon emissions — social sustainability is also important. With such a high proportion of global trade traveling by sea, shipping has a daily impact on the lives of billions of people. Maersk Line’s goal is to use all its resources more efficiently and sustainably to create a collaborative business model that promotes sustainable, profitable growth based on low-impact value chains, in which each link represents an efficient and responsible choice.

The key to sustainable growth is sustainable behaviour.

The Future

“The future belongs to those who prepare for it today”. This was the guiding principle when A.P. Møller founded the Maersk group. In terms of the global trade and transport industry, there is a wealth of opportunity available to the whole of the planet. How much of that wealth is unlocked will depend on the decisions we make today.

The Maersk Group commissioned The Economist Intelligence Unit to develop three scenarios for global merchandise trade up to 2030. The Economist Intelligence Unit developed three scenarios: a baseline, an upside and a downside.