Demand for chartered container ships remains fragile as liner operators continue to cancel key services.
Liner giant AP Moller-Maersk is suspending a key transpacific service “as a consequence of the forecast reduction in global demand”.
The Copenhagen-based company is to temporarily suspend its TP20 Asia to US East Coast (USEC) transpacific service.
The service operates with a fleet of at least 11 traditional panamax vessels, several of which are taken from the charter market.
The Danish liner operator is making the move at a time when transpacific freight rates continue to slide.
Rates from Asia to the USEC dropped to $2,556 per 40-foot equivalent unit (feu) in the week to 13 February.
That means rates are more than 80% lower than a year ago, when they topped $18,000 per feu, according to the Freightos Baltic Index.
Transpacific rates remain well below 2019 levels as demand continues to decrease, according to Judah Levine, research lead of container booking portal Freightos.
Lower volumes have helped to ease congestion and more vessels are arriving on time at US ports.
But falling volumes are also resulting in a further decline in ocean rates on other trades.
Freight rates from Asia to North Europe decreased to $2,735 per feu. That puts them more than 80% lower than rates for the corresponding week last year.
The one bright spot for freight prices is the transatlantic, where volumes remain resilient.
Big boxships bear brunt
Spot rates are still more than 250% higher than in 2019, Freightos estimates.
But the comparative strength of the transatlantic has resulted in carriers moving capacity to the trade, which has pushed rates down by 40% since August.
The collapse of freight rates is impacting the charter market where rates for bigger boxships are heading down.
A softer market enabled Tailwind Shipping Lines to secure its largest vessel to date at a lower rate.
The liner operator, which was formed last year by German supermarket chain Lidl, is taking the 6,000-teu Chicago (built 2003) for 12 months at $25,000 per day, said brokers.
The Chicago, which belongs to Germany’s NSB Group, will be taken in May after an upcoming fourth class renewal.
The fixture mirrors a fall for charter rates of larger vessels of around 18% in the past month, according to New ConTex figures.
Period rates for a 12-month charter of 5,700-teu and 6,500-teu vessels are down by $7,000 in the past month to $26,722 and $31,600 per day.
A year ago, such vessels could be fixed for $120,000 per day.
A slight revival in charter activity for smaller container ships saw Schoeller Group-subsidiary Cyprus Green World fix the first of its 10 container ship newbuildings.
The 1,930-teu Cape Ben (built 2023) has been fixed for a single trip from Asia to the Mediterranean with Italy’s Rif Line at $17,000 per day.
In other fixtures, Chinese owner Quanzhou Ansheng has found new employment for two traditional panamax boxships.
That includes the 4,380-teu Ren Jian 16 (built 2009), taken for 12 months at $18,500 per day by Dubai-based newcomer SIS Ship Charter.
