CONTAINER freight rates on Asia-Mediterranean trade lanes are expected to come under renewed pressure in the fourth quarter, as a result of ultra-large container vessels (ULCVs) being deployed on the route, according to Drewry.
By the beginning of the fourth quarter, six ships of 14,000 TEU cascaded from the Asia-North Europe route will replace six ships of 5,000-9,000 TEU, the consultant was cited as saying in a report by London's Loadstar.
Drewry calculated this would drive net capacity up by one per cent, potentially lowering load factors in the traditionally weak final quarter, adding: "Until then prices are expected to remain firm."
As on the Asia-North Europe trade, shipping lines have managed their capacity more judiciously since the new alliance structures were introduced in April. This includes three blanked sailings in May and two in June.
Similar to the bigger trade, reports suggest that there is a lack of appetite from Asia-Mediterranean carriers for a return of the rate wars that dented their balance sheets last year.
Drewry's supply and demand calculation for May suggested westbound demand was at 506,000 TEU versus supply at 567,000 TEU.
"With carriers able to sustain westbound load factors on or around 90 per cent from March to May, spot rates have trended upwards," said Drewry. It added that based on revised data from Container Trade Statistics (CTS), the "trade is doing much better than previously thought to be the case."
According to CTS, the growth in head-haul traffic in the first quarter amounted to 5.6 per cent, and for April and May the growth rose year on year by 6.9 per cent.
In percentage terms, the distribution between the western and eastern regions over the first five months of the year shows eastern Mediterranean ports with a y-o-y increase of 8.9 per cent, compared with a 4.9 per cent rise for the western sector.
Last week, Drewry's World Container Index reported spot rates from Shanghai to Genoa at US$1,780 per 40-foot container which, it noted, was "still down on the early January peak of $2,150 per 40ft, but broadly the same as at the same stage last year."
Source: SchednetPrevious Next
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