- A new round of cancelled sailings by major container shipping lines could be inevitable after the six-day disruption to Suez Canal transit last month.
- It is to further deteriorate schedule reliability for shipments from Asia to East Coast North America, market sources said.
- All 422 ships stuck in queue after the grounding of the Ever Given in the southern segment of the canal on March 23 had finally made their transit by April 3.
A Platts news report says that container markets face high rates and canceled sailings after Suez incident.
Ripple effects of the Suez incident
But the ripple effects of the incident across global networks could be felt in the weeks or months to come as the one-week delay in arrivals to East Coast North America leads to an equivalent delay for the ships returning to Asia, Danish shipping line AP Moller-Maresk said in an advisory to customers on March 31.
“Ultimately a right sizing of the network will have to be taken in order to account for the continued delays, and this will unfortunately come in the form of blank (cancelled) sailings as that remains the only option to bring schedule reliability back in line,” Maersk said.
Shipments from South and Southeast Asia to the US East Coast
Shipments from South and Southeast Asia to the US East Coast could be among those most affected as the growing trade lanes utilize the shorter westbound route through the Suez Canal, while shipments from North Asia to the US East Coast typically transit the Panama Canal from an eastbound direction.
CMA CGM from Malaysia’s Port Klang
Shipments handled by French shipping line CMA CGM from Malaysia’s Port Klang to the US East Coast ports of New York/New Jersey, Norfolk, Savannah and Charleston increased by 105% in the combined months of January and February 2021 from the same period last year, according to data from Panjiva, part of S&P Global Market Intelligence.
Freight rates from Asia to Europe
The disruption to shipping schedules and strong potential for cancelled sailings could support container freight rates from Asia to Europe and North America in the months ahead as importers grow fearful of their cargoes getting rolled to a later date, said Lars Jensen, CEO of SeaIntelligence Consulting.
“Shippers will be extremely anxious to secure capacity – vessel space as well as equipment – for their own shipments, and hence this pressure could serve to either drive rates up or to maintain rates which are still at historically high levels,” Jensen said.
Platts Container Rate 5 – North Asia to East Coast North America – was assessed on April 5 at $5,200/FEU, up by 89% from the year-ago date. North Asia-to-UK Continent rates rose to $9,500/FEU on April 5 from $1,275/FEU on the same date last year.
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Source: Platts
