Taiwanese carrier Evergreen and its Ocean Alliance partners are redeploying ultra-large container vessels (ULCVs) from the Far East-North Europe trade to the Mediterranean, in response to the Red Sea crisis cutting off much of the region’s capacity.
Since the onset of Houthi attacks on commercial shipping, the Ocean Alliance’s main east Mediterranean hub of Piraeus, which previously served as a major waypoint call on Far East vessels en route to North Europe, has found itself the end point on Asia-Mediterranean strings, and capacity serving its regional hinterland has withered as a result.
Sacrificing North Europe capacity
The move will involve sacrificing North Europe capacity currently deployed on the Ocean Alliance’s Far East-North Europe CES service, which previously had a call at Piraeus and will now deploy 13,800 teu vessels, to the Asia-Med MD2 rotation.
“Evergreen’s CES service (Ocean’s NEU7) used to call at Piraeus as its first European westbound port of discharge on the way to Antwerp, Hamburg and Rotterdam,” Alphaliner wrote in a new analysis today.
This lack of recent capacity has been reflected in container spot freight levels and this week’s Ningbo Containerised Freight Index climbed 5% for Ningbo-east Mediterranean shipments.
However, the capacity switch will have a knock-on effect for North European shippers, Alphaliner added.
Major ramifications
The diversions from the Red Sea have had major ramifications for the allocation of ship tonnage, meaning that more carriers are resorting to using smaller vessels as feeders in the Med. According to Alphaliner, 2,700 teu-2,900 teu vessels – shunned until late 2023 – are now commanding two-year charters, to the delight of non-operating owners (NOOs).
However, few NOO ships are available for charter, Alphaliner data indicates, and daily hire rates for all sizes have been climbing this year. In the 8,500 teu bracket, charter rates are more than double 2019’s, and substantially elevated even over 2020 levels.
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Source : Loadstar
