The current landscape of ocean container shipping is being heavily influenced by two key factors: the formation of new carrier alliances and the continued disruption in the Red Sea. A recent webinar hosted by Xeneta’s George Thomas and Emily Stausbøll delved into how these factors are shaping the market and what shippers can do to mitigate risk.
The Gemini Alliance and Schedule Reliability
The Gemini Alliance, a long-term operational partnership between Hapag-Lloyd and Maersk, launched on February 1, 2025, with the ambitious goal of achieving 90% schedule reliability. This stands in stark contrast to the global average at the time of its launch, which was only 53%. While global schedule reliability has since risen to just under 60%, it remains far from the pre-pandemic average of closer to 80%.
Despite this, early data from the Gemini Alliance’s first month of operation is promising. Hapag-Lloyd reported an average schedule reliability across all alliance port calls of 90.3%, a figure nearly 40 percentage points above the global average. This is a significant early success, especially given the ongoing market disruption and initial skepticism from freight forwarders and shippers. The alliance’s model, which uses a “hub and spoke” network with fewer direct port calls, appears to be effectively prioritizing reliability. However, it’s important to note that while direct calls may have a lower transit time, many containers will require transhipment, which must be factored into the overall journey.
The Red Sea: A Complex and Volatile Picture
The Red Sea remains a significant source of complexity and disruption. While there has been a recent increase in the number of ships, particularly smaller ones, returning to the Suez Canal, it’s not a return to normal operations. For instance, a CMA CGM containership of 15,000 TEU capacity recently transited the Suez Canal, but it required a French military escort, highlighting that special security guarantees are still necessary.
The conflict between Israel and Iran has added another layer of risk to the area, threatening its safety and stability. The ongoing Red Sea crisis is a primary reason for the high freight rates over the past 18 months, as longer routes around the Cape of Good Hope have increased TEU-miles demand and tightened fleet capacity.
Shippers Must Understand the Fine Print
In this volatile market, shippers must be meticulous when finalizing new freight agreements. Xeneta’s experts advise paying close attention to:
- The meaning of “guaranteed”: Shippers must understand whether their cargo will be shipped under all circumstances or if there are risks of it being “rolled” (left behind).
- Hidden surcharges and change clauses: It is essential to protect against unexpected costs and terms.
- Risk Allocation: Shippers must be clear about who bears the risk for delays and cancellations.
Having access to real-time, accurate data is essential for navigating these challenges and ensuring that what is promised in a contract is what is delivered in practice.
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Source: Xeneta
