0° C
The location could not be found.
Bezoekers Registratie

Welkom bij de Kramer Group

Vul uw gegevens in om u te registreren wanneer u Kramer Group gaat bezoeken.

Alphaliner: Rate war is real now, and it’ll get worse

CARRIERS: There are no signs from Maersk Line and other market leaders that they intend to reduce their capacity on the routes between Asia and Europe. Their only hope now is that demand begins to increase, says Alphaliner.

The major carriers failed in their attempts to maintain the spot rate on Asia-Europe at a profitable level by not pulling out sufficient capacity to adjust it to fit the demand. This means that the price war, which cost the carriers huge amounts of money back in 2011, is now back in full force, and the situation could become worse in coming months. The carriers’ only hope now hinges on whether demand could increase in order to avoid further rate drops, according to data from Alphaliner.

In total, carriers will insert 20 new container ships of 8,500 to 16,000 teu between Europe and the Far East in the second quarter, in addition to the seven ships that were inserted in March alone. Tha rapid and dramatic capacity increase has reignited the price war, and it has made the rate level plummet by USD 600 per teu since the beginning of the year. Spot rates from China to Europe are currently at USD 700-800 per teu, compared to USD 1,300 – 1,400 in the beginning of 2013.

“Carriers have limited options to keep capacity in check, with the incessant deliveries of new tonnage hampering their ability to make any meaningful capacity cuts. The timing of the deliveries was intended to take advantage of the anticipated summer peak season, but weak cargo volumes have kept utilization levels at only 80% on average in April with a very slow pick up in demand this year,” writes Alphaliner in its newsletter on Tuesday.

Maersk Line’s inserting the first of its Triple-E ships in July – the first of a series 20 Triple-E ships of 18,270 teu, the world’s largest – will make it even more difficult to reduce the capacity:

“Although Maersk has declared that it will neutralize the additional capacity brought by the introduction of the Triple-E vessels, it has not indicated any capacity removal so far,” writes Alphaliner, pointing out that Maersk Line hasn’t announced any changes for May, while the carrier “has issued warnings stating that it intends to protect its market shares.”

The only slight capacity adjustment in the next two months will come from from the cooperation between Evergreen, CSCL, and Zim. The consequence of their 9,000 teu per week reduction, starting mid June, will at the same time be countered by various service upgrades at approximately 16,500 teu per week.

via: www.shippingwatch.com