Container lines

Slow-steaming has come to the fore of late as ocean carriers seek help in absorbing overcapacity, but analyst Lars Jensen says the common refrain that slower speeds also help to improve schedule reliability doesn’t hold water.

An emerging trend of sending smaller shipments more frequently is leading to growing demand for LCL services across the major trade lanes.

Shippers and port executives say the post-COVID shift of cargo back to Hong Kong is being hampered by the global slump in demand as developed countries grapple with elevated inventories and inflationary pressures.

Thanks to a recent GRI push, average contract rates for India to the US have seen modest gains in recent weeks and carriers are now looking to build around that limited success.

The port congestion in Asia and North America that compromised vessel on-time performance during the pandemic began to ease last fall with declining cargo volumes, and the reliability improvements have accelerated since.

The carrier's CEO said inflation and destocking in global markets heralded a “phase of normalization” for container shipping.

End-to-end supply chain visibility remains an elusive goal for providers in a market where shippers are expecting better data quality than they have seen.

Ocean carriers are pulling all available capacity management levers to address a supply-demand imbalance that is set to widen significantly through 2024.

With spot freight rates largely stabilized, ocean carriers have blanked fewer sailings in May and instead opted for more biweekly sailings.

Although the container shipping order book is the highest it has been in many years and demand remains subdued, the ground is shifting under the ocean market in new and unfamiliar ways, writes Peter Tirschwell.

While indicators may point to a “normal” container shipping market in the wake of the pandemic, it is important to remember that disruptions large and small are all part of that normality, writes analyst Lars Jensen.

New green services from ocean carriers are being offered to the market as transport providers focus efforts on meeting industry decarbonization targets.

The Israel-based carrier is adding larger ships powered by liquefied natural gas to the Asia-US East Coast trade to capture sustained demand and lower unit costs.

Taiwan-based Wan Hai is adding a call to Colombo, a busy transshipment hub for Indian exporters, on its AA7 loop between Asia with the US East Coast.

A deteriorating container shipping market made the first quarter one to forget for the Israel-based carrier, but its full-year outlook remains positive.

The carrier will pay the penalty to avoid the Federal Maritime Commission launching a formal investigation into whether it violated US detention and demurrage shipping laws.

Forwarders do not expect prices to stabilize or trend up any time soon, with carriers increasingly struggling to secure steady booking levels to fill their export allocations out of India despite capacity readjustments.

With import volumes sharply lower than last year, trans-Pacific carriers are more willing to consider requests for fixed-rate pricing and inland transportation bookings in 2023-24 service contracts, sources say.

Virtually no ships have been scrapped in the past two years as high demand and port congestion kept all available capacity in use, but that is about to change significantly, according to the shipping association.

When operational in 2025, a plant in Sweden will be able to produce 50,000 tons of green methanol annually for the shipping industry, making it Europe’s largest methanol plant.

The growth in participation in FLOW is a signal that the private sector views the voluntary nature of the project as more amenable than governmental data-sharing mandates or legislation.

The South Korea-based liner became the latest carrier to illustrate the post-pandemic crash in container shipping, posting a 91% drop in net profit for the first quarter.

The Taiwan-based carrier is the latest container shipping line to have its extreme profitability of recent years slashed by a slowdown in demand and excess capacity.

A surge in volume from Asia to the Mediterranean in March has carriers injecting capacity into the trade to capture growing demand from southern Europe.

Hapag-Lloyd believes an increase in demand on east-west trades in the third quarter, together with rising carrier costs and IMO emissions rules, could mitigate the impact of surplus capacity flooding into the market.

The decision by ocean carriers to not charge per diem fees when gates are closed will result in money remaining in the pockets of importers and exporters rather than flowing to carriers and terminal operators — and anyone who thought that would happen without a fight is dreaming, writes Peter Tirschwell.

The change comes in advance of the FMC’s final rule on detention and demurrage billing that is due to be published in mid-June and has already generated pushback from marine terminal operators.

While rates on the trans-Pacific and Asia-Europe trades may have hit bottom, there is still some way to go before headhaul trans-Atlantic prices reach pre-pandemic levels, but the gap is narrowing by the week.

Consumer spending in the coming months will be compromised somewhat by high inflation, while retailers are being conservative in placing purchase orders with factories in Asia because of bloated inventories, according to the Global Port Tracker.

Bolloré said it will bring the carrier’s $5.5 billion offer to the rest of the group for consideration after an exclusivity period for negotiations expired Monday.

An automotive parts importer alleges that after Evergreen failed to provide approximately 65% of contracted vessel space, it had to pay $750,000 on the spot market to secure capacity.

Shippers, truckers and other transport interests have filed more than 287 complaints with the FMC since last June, mostly involving detention and demurrage billing.

A container tracking hardware vendor behind Hapag-Lloyd's deployment of dry box sensors is linking with supply chain visibility provider project44.

The rapid normalization of global cargo markets continues to drag down the financial results of carriers from the record highs of the past three years, with Maersk the latest line to report a sharp decline in first-quarter earnings and an uncertain outlook for the balance of 2023.

An agreement on manning requirements at conventional terminals at the ports of Los Angeles and Long Beach could open the door for a deal on a tentative coastwide contract in the next couple of weeks, sources say.

While the executive expects some level of demand rebound in the second half, he hedged that the summer season may not be as healthy as a typical year given uncertainties in the economy and consumer sentiment.

Finding a way to incorporate Europe’s emissions regulations into contracts between those in the shipping value chain is taxing the industry’s financial minds with just eight months to go before the rule is implemented.

Forwarders generally believe the limited GRI gains that have been achieved or are anticipated in the coming weeks on the India-US trades will be short-lived unless more capacity is withdrawn or a large increase in volumes occurs.

With cargo volumes dropping in most of the global trade lanes, supply chain bottlenecks that had contributed to deteriorating vessel schedule reliability in 2021-22 are no longer a major problem this year.

The now-bankrupt retailer alleges the ocean carrier failed to provide the full vessel space it contracted for, then charged much-higher premiums to ensure its cargo wasn’t rolled.