Container shipping operators appear confident that freight rates will improve as peak season approaches.
Freight rates on three key routes from China to the US and Northern Europe rose or were stable this week for the first time following months of decline.
That has given transpacific liner operators the confidence to try to push through rate increases of up to $1,000 per forty-foot equivalent unit (feu) this month.
Germany’s Hapag-Lloyd to push through a general rate increase up to $1,000 per feu on 1 May — a rate which would effectively double the current spot rate.
The belief that demand for container shipping will rise derives from signs that inventory levels are finally running low and need replenishing.
A survey of over 664 shippers by logistics platform Container xChange pointed to “cautious optimism” that the coming peak season will be better.
“The shipping industry is experiencing a freight recession due to the postponement of inventory replenishment cycles by retailers who overstocked,” said Christian Roeloffs, co-founder and CEO.
“As we look ahead, we anticipate a subdued rebound in demand as retailers begin to deplete their excess stock in the coming months, leading up to peak season.”
The newfound confidence of liner operators comes amid the launch of new services by liner operators in Europe, Asia and even Iran.
Liner upstart Ellerman City Liners is further expanding its short-sea services in northwest Europe.
The UK-based company will launch a direct service connecting Poland with the United Kingdom at the end of April.
The company will also offer transshipment services to the United States, as well as to Portugal and Spain.
Ellerman, a subsidiary of UK freight forwarder Uniserve, was established early in 2022 to operate a liner service from Asia to Europe.
After rates on that trade plummeted, the company shifted vessels to the more profitable transatlantic and European shortsea services.
The company will augment those services on 28 April and launch a new service from Gdynia in Poland to Tilbury and Teesport in the UK.
Asian launches
Those moves are being emulated by operators of regional services in Asia.
Chinese giant Cosco and its South East Asia subsidiary New Golden Sea Shipping are launching a dedicated Singapore-Philippines feeder service.
CNC, the intra-Asia arm of CMA CGM Group and Thai carrier Regional Container Line, are co-loading on the loop.
The new service will be operated with two small feeder vessels, the 1,134-teu Sol Stride (built 2006) and the 1,150-teu Bright Laem Chabang (built 2007), according to Alphaliner.
Separately, there are unconfirmed reports that the Islamic Republic of Iran Shipping Line plans to launch a direct container route between Iran and Brazil.
That could happen as soon as July, according to an Iranian-Brazilian source cited by the Mehr News Agency.
According to the survey by Container xChange, stakeholders in the industry are hopeful that the pent-up demand will be released this quarter as retail inventories are replenished.
That follows a slump in demand and overstocking by retailers.
