Container lines

HMM has opened an array of connections out of India in recent years, including the launch last August of a solo, 12-vessel string connecting the Far East, the Middle East and the Mediterranean.

Some analysts are reassessing their outlook for the container shipping industry as the Red Sea crisis absorbs capacity and pushes rate levels higher on the Europe and US East Coast trade lanes out of Asia.

Rates on the headhaul corridor have been loss-making for the last few months, so carriers are trying to get prices up to what they consider more sustainable levels.

Difficulties in finding vessel capacity and empty containers as ship voyages are extended will join rising rate levels on the growing list of supply chain issues faced by shippers.

The shipping industry, while acknowledging the batteries are here to stay and can’t be banned as cargo, is lagging behind in coming to terms with risks that remain poorly understood.

Short-term contract rates on the trade lane have already more than doubled this week from what most major carriers were quoting in the second half of December.

The upending of regular transits to the US East and Gulf coasts through the Suez Canal has prompted ocean carriers to issue rate increases to cover higher operating costs.

With ocean carriers rushing to the FMC to seek waivers of the 30-day notice period required to implement surcharges linked to the Red Sea crisis, the head of a major US shipper group says the commission should require carriers to provide more transparency around the additional costs the charges are meant to cover.

There remains little clarity on carrier plans to resume Red Sea transits following Sunday’s dramatic action by the US Navy to repel an attack on a Maersk container ship.

Global container ship overcapacity will compel carriers to increase blank sailings and service cuts to keep a floor under rates, which means shippers are likely to continue to see poor on-time performance on eastbound trans-Pacific services.

The carrier’s decision to suspend Red Sea sailings for at least 48 hours following two attacks this weekend shows that even as naval forces ramp up patrols in the region, safety is far from guaranteed.

Most of the surcharges and GRI hikes will take effect from Jan. 1, with at least one ocean carrier hinting of further increases to come later in January.

Almost four years after COVID-19, a new crisis is once again shining a light on the traditional contentious relationship between container carriers and their customers when it comes to pricing dynamics, writes Lars Jensen.

With around 130 methanol-enabled dual-fuel container ships on the water or on order, carriers have been scrambling to secure supplies of the green fuel.

The Federal Maritime Commission’s final rule on detention and demurrage will be a watershed moment in the industry next year, but it won’t be the only one.

As the impact of longer routings percolates through the supply chain, local industry sources expect a wave of void calls and/or alterations in Indian port rotations across various trade routes.

Ocean Network Express and Hapag-Lloyd confirmed they are skipping calls, especially at Cartagena in Colombia and Manzanillo in Panama, although omissions are being made at other ports.

The US Central Command said a US Navy destroyer and fighter jets on Tuesday shot down 12 attack drones, three anti-ship ballistic missiles and two cruise missiles launched by the Houthis from Yemen.

The push to become a go-to stop for alternative fuels comes as Hong Kong is set to see container throughput fall to around 14 million TEUs in 2023, a 27-year low, amid waning transshipment volumes.

Maersk's decision to resume sailings through the Red Sea reveals confidence on the part of the carrier with they have been told by naval coalition forces about their capabilities and willingness to act in defense of shipping.

With increasing instability around the world, we might be approaching the point where a carrier’s reach is no longer truly global as liners are forced to make commercial and political decisions that will shape the scope of their operations, writes analyst Lars Jensen.

While shippers adapt to the complicated market environment in the short term, they are also casting a wary eye on annual service contract negotiations with carriers that will heat up early next year.

The anticipated costs to shippers of the Red Sea crisis are becoming clearer, with spot rates up sharply and rate hikes and surcharges announced by ocean carriers.

The service will be heavily focused on transporting refrigerated cargo but will also allow for dry cargoes coming out of Latin America to find a new path to the US.

The port wants to dig to a 55-foot depth because an increasing number of vessels calling are testing the current capacity of its shipping channels.

After holding rates firm at end-November levels into the first week of December, major container lines have pushed short-term contract pricing substantially higher for Indian bookings in the last few days.

Five of the world’s top 10 ocean carriers have so far announced diversions away from the Red Sea, and their language suggests there is growing acceptance that this crisis will be open-ended.

The South Korean carrier has settled on an offer from a consortium led by poultry producer Harim Group, but there are doubts over the buyer’s ability to manage a global shipping line.

While moves to send ships around Africa in response to the Red Sea attacks may be driven by safety concerns, the rate hikes that will accompany the emergency action will be welcomed by carriers in the loss-making trade lane.

Acquiring a terminal stake at Ennore in southern India builds on MSC’s existing 50/50 terminal joint venture with Adani at Mundra Port.

Expectations that the US Navy will step up maritime protection in the Red Sea following an increasing number of attacks on commercial shipping hasn’t stopped carriers from routing services away from the Suez Canal.

Several vessels heading south for the danger zone off the coast of Yemen are making U-turns and will likely take the far longer route around the African continent via the Cape of Good Hope.

A strong Black Friday and Cyber Monday, coupled with rosy sales expectations, are spurring US retailers to boost their import forecasts for early 2024, according to the National Retail Federation.

Attacks have intensified since the end of last month when Iran-backed Houthi rebels began indiscriminately targeting ships sailing in the Red Sea near Yemen, leading some operators to avoid sailing in the area.

While carriers have been revising their ETS surcharges with carbon pricing on the markets becoming clearer ahead of the implementation date, the price differences have shippers and analysts scratching their heads.

Next year’s schedule will see two services that were suspended in 2023 remain offline, but two Asia-US services will be restored and new port calls added overall.

Container shipping is hardly the only industry to feel the impact of organized labor’s bargaining power, nor is it unique in dealing with heightened geopolitical flashpoints or regulatory pressures tied to decarbonization, writes Journal of Commerce Executive Editor Mark Szakonyi.

It’s looking like 2024 will follow a familiar script for container shipping, with ocean carriers facing down market challenges by taking action that typically disadvantages their customers, writes Peter Tirschwell.

Despite Indian exports picking up, there is skepticism about a rosier 2024 in the wake of multiple potentially disruptive events unfolding in the container shipping industry, including Panama Canal restrictions and recent attacks on commercial shipping in the Red Sea.

Motor carrier TCW was unable to prove that street turn fees violate US shipping law in one of the first test cases to see how the Federal Maritime Commission might regulate those charges.