Cargo cult 🏗️

In a factory on the outskirts of Shenzhen, a 40-foot steel box rolls off the production line. Made of weather-resistant Corten steel and welded together in under four hours, it costs around $2,200. Stamped in white stencil: CAXU 932084-0.

There are more than 180 million shipping containers in circulation and each is part of the TEU system – short for twenty-foot equivalent unit – the basic measurement of containerised trade. In January 2025, global container throughput reached 15.4 million TEUs, up 5.8% from the prior year.

A 40-foot container like CAXU counts as two TEUs. Every major port, crane, and vessel is calibrated to this metric, meaning a box built in China can slot neatly onto a rail wagon in Germany or a truck in the US.

Anatomy of a container

Containers are built with reinforced corner castings so cranes can lift them from any side. Twist-locks secure each box to the next, letting ships stack them eight or nine high. Vents regulate air pressure and seals keep out saltwater and heat. And there are different types. A 20-foot ‘dry’ container for general cargo, a 40-foot ‘high cube’ for bulky goods, a ‘reefer’ unit fitted with refrigeration.

China manufactures more than 90% of the world’s containers. Most are not owned by the companies using them. Instead they’re leased by global firms such as Triton International, Florens, or Textainer. Together they control roughly 40% of the global leasing market.

The container changed where the world makes things. Companies began producing where labour was cheapest, leading to the rise of export-manufacturing zones in East Asia, confident that components would arrive by the same standard steel box.

‍CAXU’s first gig is with a Shenzhen electronics exporter. Inside go pallets of consumer tech worth around $50,000, the kind of mid-value cargo that fills most container ships. Within days the box is lifted by gantry crane onto a vessel bound for Europe.

Productivity hack

CAXU 932084-0 and its ilk can be traced back to 1950s trucking entrepreneur Malcolm McLean, who spent the 1930s building one of America’s biggest trucking firms. By the 1950s he was frustrated his rigs spent hours waiting at ports while goods were unloaded by hand – a slow, labour-intensive process known as break-bulk cargo handling.

So, in 1955 he sold his trucking company, bought a small shipping line, and began experimenting with moving entire truck trailers onto ships. The breakthrough? Realising the chassis was unnecessary. Only the box mattered. 

On 26 April 1956, his converted tanker Ideal X carried 58 metal containers from Newark to Houston cutting cargo-handling costs from about $5.83 a tonne to $0.16. Ships that once spent two-thirds of their time in port could now turn around in hours, and dock labour productivity leapt from 1.7 tonnes per hour to 30. Within a decade, container ports like Newark were moving more freight than all of Manhattan’s piers had at their peak. 

Working with engineer Keith Tantlinger, McLean developed the corner fittings and twist-locks that made stacking possible. The idea became a standard in 1968, when the International Organisation for Standardisation (ISO) set the container dimensions still used today. Within five years, trade between some countries grew more than 300%. Within twenty years, containerisation had expanded world trade twenty-fold and accounted for a third of all US imports and exports by value.

Before 1968, there were dozens of rival container sizes. The US military, railroads and shipping lines couldn’t share equipment. It took logistics headaches during the Vietnam War to convince industry, and the Pentagon, to standardise on the 20- and 40-foot box.

Global conveyor belt

Our container joins a vessel in Yantian port, part of Shenzhen’s sprawling export complex. The world’s third-busiest port, it handled 28.8 million TEUs in 2024.

The ship that carries CAXU, likely a 24,000 TEU ultra-large container vessel, burns around 200 tonnes of fuel per day – costing roughly $120,000. At sea, efficiency is everything with each box responsible for its share of bunker fuel, crew wages, port fees, and insurance. The total voyage cost, divided by the number of containers carried.

Yet even the smoothest voyage is vulnerable. There have been repeated attacks by the Houthi movement targeting commercial vessels in the Red Sea, prompting major carriers to avoid the route entirely. Rerouting around the region now adds 10-14 days and roughly 12% in extra fuel-tonne demand, pushing freight rates higher.

In 2024, container freight rates were up 149% and charter rates were up 48%, driven largely by these detours. A single blockage, like the 2021 Suez incident, can freeze $9 billion of goods per day.

What’s in the box?!

After 27 days at sea, CAXU reaches Rotterdam where automated cranes unload about 30-40 containers an hour. The reduced reliance on human labour thanks to containerisation saw trade move from the old city docks of London, New York, and Liverpool to vast out-of-town terminals designed for machines. Rotterdam alone now shifts more cargo in a week than all of America’s West Coast ports handled in a year when containerisation began. 

As you can probably imagine, containerisation gutted the old dockside workforce. Tens of thousands of longshore jobs vanished in New York and London, and turned city waterfronts into real estate.

Port dwell time still averages three to five days, most of it waiting for customs clearance or transhipment (changing ships, not unpacking cargo). Around one-third of the containers in the yard are empty, an inevitable industry quirk. East-to-West flows send full boxes outward. Empties return or sit idle. Moving a can of air across the Pacific can cost $1,000-1,200.

After unloading in Rotterdam, CAXU is rail-bound for Hamburg, carrying auto parts for re-export to the US. Containers like CAXU travel an average 5,245 miles per shipment, up from 4,831 in 2018.

Idle asset

In Newark, CAXU is unloaded, emptied, and parked in a depot with thousands of others. Global container capacity is about 60 million TEUs, but utilisation can swing from 70% in downturns to more than 90% during booms.

The cost of shipping a 40-foot box from Asia to Europe, once above $14,000 in 2021, has fallen to $1,500-2,000 in 2025. But margins remain thin and the industry is known for swings between windfall profits and deep losses, all within a single business cycle.

Each box’s next move is an algorithmic decision. Relocation to Asia, lease domestically, or sell into the secondary market. Leasing companies now manage much of this balancing act. The container leasing market is worth about $20 billion, growing at a 4.3% CAGR to 2035.

For now, CAXU sits idle. Perhaps due to wider slower trade growth (forecast 2.4% in 2025) and geopolitical friction, which have left many containers twiddling their thumbs. Overcapacity has returned just three years after record profits.

Six months later, our container is sold for $3,500 to a modular-housing start-up. Across the world, decommissioned containers are repurposed into homes, offices, and pop-ups. The container-conversion industry was worth more than $20 billion in 2022.

The world inside the box

By this point, CAXU has travelled more than 500,000 kilometres. That’s more than 12 times around the planet. It’s typical for a container, with a working life averaging around 15-20 years before being scrapped or resold.

Efficiency has limits. The more tightly the system runs, the less room it has to absorb shocks. Rerouted ships, idle boxes, and fragile margins all weigh on the industry. Investors watch container utilisation as a proxy for economic activity. When boxes pile up, it often precedes a slowdown in global manufacturing. When lease rates surge, inflation and trade demand are rising. Even the cost of a secondhand container can act as a rough leading indicator for industrial cycles.

Environmental regulation is set to be the next evolution of containerisation. Shipping produces about 3% of global CO₂ emission. The International Maritime Organisation aims to cut emissions 20-30% by 2030, forcing fleet retrofits and higher costs, as well as investment in cleaner propulsion and digital tracking.

‍CAXU 932084-0 started life as a cog, a thread in the wider tapestry of globalisation. By the time it ends up as a micro-office or scrap metal, it will have outlived several shipping cycles, numerous trade agreements, and a few recessions. Not bad for a box.

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