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(Christopher Harress)

The average lifespan of a well-manufactured steel shipping container is thought to be about 12 to 15 years, during which time it will be transported to ports all across the world and loaded on to trains that will carry it the length and breadth of continents. However, the industry that uses these sturdy and well-traveled boxes, which are the foundation of the international import and export business, has recently found itself in financial turmoil, causing a ripple effect to international ports and raising questions about the health of the shipping business.

Earlier this month, the Hanjin Shipping Co., one of the world's largest shipping companies, filed for protection under chapter 15, a section of U.S. bankruptcy law that deals with international insolvency. The filing was the result of a current and dangerous industry-wide trend: too many ships and not enough customers.

"The container industry itself is not in particularly good health right now," said Alabama State Port Authority CEO James Lyons, who said that Hanjin's bankruptcy was the biggest he could remember during his 40 years in the industry. "But for us as a port, that's really not germane because the volumes are still there and the shippers are still going to ship the containers."

Hanjin previously had two ships coming into Mobile as part of a consignment of 11 alongside Chinese shipping giant COSCO. However, COSCO has already absorbed the loss of Hanjin's business and is continuing to deliver consignments into Mobile as normal, said Lyons.

While Lyons told AL.com that the last two months had been record months for the Port of Alabama in regard to shipping containers coming into the port, the most recent statistics from United States Maritime Administration (MARAD) show a significant decrease in container ships calling into the port, going from 200 in 2014 to 156 in 2015. In all, the port dealt with around 3 million fewer tons over the same period, according to MARAD.

Similarly, in the Port of Long Beach, California, which is one of the largest ports in the county, imports are down 10.2 percent from August 2015 to this year. This, according to Lyons, has more to do with shipping companies taking their cargo directly through the Panama Canal and instead into ports in the Gulf of Mexico. The Panama Canal is wider than it used to be and is able to accept larger ships, which means it can often be more financially viable for shipping companies to use Gulf ports than unload on the west coast and use trains to take cargo east. However, the decrease in traffic on the west coast hasn't necessarily reflected in higher consignments coming into the Gulf, with MARAD data showing that most ports in region have remained flat from 2014 to 2015 with the exception of a small increase in New Orleans.

The biggest problem faced by the shipping industry is that is has too many ships and not enough demand to justify those ships. "It's as if the airlines went out and bought 20% more aircraft than they had customers to buy tickets, and then wondered what happened," said Paul Bingham, a trade economist with the Boston-based Economic Development Research Group Inc. "It was unsustainable."

The reduction in demand has come about partly because of the changing relationship between the U.S. and China. The Asian giant has slowly shifted over the last 10 years from a manufacturing economy toward being a consumer economy. That has been led in part by higher wages and spending power for Chinese consumers, enabling certain classes in the country to get out of the factories and into stores. That change, along with the U.S. market becoming over saturated with Chinese goods, has impacted shipping companies badly.

In 2011, the shipping container industry lost $7.7 billion, which was generally believed to be a hangover from the global financial crash of 2007-08. By 2012 that figure had recovered to a small loss of $100 million, and in 2013, 2014 and 2015 the gains were a healthy $0.8 billion, $5.7 billion and $3.9 billion, respectively. However, this year the profits have dried up and the industry is expected to lose around $5.2 billion because of the decreasing cost of shipping a container and lower volumes, according to a report by Drewry Maritime Research, a London-based shipping consultant firm. For example, the average shipping company revenue on a 20 ft. container has gone from $1,189 in 2011 to $776 this year.

Those losses sustained by the shipping industry are mirrored somewhat when you look at the number of containers coming into the port of Mobile. In good years for the shipping industry, Mobile has taken in greater volumes of containers. In 2011, Mobile's count of 20 ft. containers coming into port, also known as TEUs, was around 145,000. As the shipping industry recovered some of its huge losses in 2012, TEUs in Mobile rose by around 45,000. As the recovery continued into 2013, Mobile's TEU count jumped again to about 225,000 and then to 238,000 in 2014. However, as profits in the shipping industry decreased in 2015, TEUs in Mobile dropped to 231,000. With the fiscal year due to end at the end of this month, Mobile currently sits on just under 228,000 TEUs, with officials expecting September to take it beyond 250,000.

This potential increase is in a large part due to new business coming into the port. Since June, the port now has five container ships calling into port every week, which if sustained should keep the TEU count high moving into 2017. In addition, new train routes serving Memphis and Chicago have meant that cargo holders in those regions are looking at Mobile more seriously as a point of entry. Previously, those regions had been served by trucks coming from Mobile, or freight was just brought in from the west coast.

But despite a growing port, the realities of an industry that is facing multibillion dollar losses in 2016 is never too far from Alabama Port CEO Jimmy Lyons' mind. "It's never good when you customers are experiencing financial difficulties," he said. "And we may see another bankruptcy in the near future."