By Charlotte Goldstone (The Roadster) –
2M Alliance members Maersk and MSC have reduced calls at European ports on upcoming voyages to avoid congestion after demand for ocean freight from China to Northern Europe continued to set new records in June.
The Danish shipping giant informed customers yesterday: “In light of current supply chain bottlenecks across our network, we are implementing measures to improve schedule reliability on our network from Far East Asia to Northern Europe.”
The move is an attempt to improve schedule reliability for three services in the 2M network: AE6/Lion, AE7/Condor and AE55/Griffin.
AE6/Lion Services will miss a call to Rotterdam, one of Antwerp's two ports, and add a call to Le Havre on its 432W voyage with MSC Michel Cappellini.
AE7/Condor will eliminate the Le Havre call on Maersk Horsburgh's 433E voyage, while AE55/Griffin will also omit Le Havre, Colombo and Singapore and add Hong Kong and Yantian, with Colombo cargoes being transshipped from Hong Kong and called on MSC Vandia's 432W voyage and MSC Amsterdam's 431E voyage.
Switzerland-based MSC said its “updated network is designed to improve our services, serve new ports and adapt to the ongoing challenge of port congestion in Europe, while continuing to offer competitive transit times for cargo movements between Asia and Northern Europe.”
Data from Xeneta and Container Trade Statistics this week showed that 800,000 TEUs were shipped from China to Northern Europe in June, a monthly record for this trade.
Peter Sand, principal analyst at Zenata, explained: “Shipowners are assessing the impact of the Red Sea dispute on their maritime supply chains and are not willing to risk a repeat of the pandemic-era disruptions.”
But he noted that the desire to protect supply chains “comes at a heavy price” for shippers.
Indeed, June's record volumes coincided with a sharp increase in average spot rates for trade from the Far East to Northern Europe, which rose 166% between April 30 and July 1, according to Xeneta data.
“Shippers who rushed to import may have spent much more than they would have liked, but they clearly felt that the price was worth paying to reduce the risk level in their supply chains at the end of the year,” Sand added.
However, Zena said there were signs that demand for container shipping from China to Northern Europe had peaked, reaching record levels.
“There is a clear correlation between record volumes in the primary trade from China to North America and Northern Europe and trends in the spot market,” Sand said.
Average spot rates from the Far East to Northern Europe have fallen 1.6% since 31 July.
“If spot rates are currently softening, it means that demand for ocean container shipping has already peaked, which should lead to lower volumes in the normally peak months of July and August,” Sand said.
However, Chris Higgins, commercial director at AFS Global, told The Loadstar: “As we head into the first winter season using the bypass route around the Cape, coupled with still-reduced capacity and equipment not being in place, we do not expect freight rates to fall as quickly as they have risen.”
“While demand may return to sustainable levels, we believe challenges remain on the supply side due to Golden Week (in October), winter weather and the early start of Chinese New Year in 2025, which could lead to importers over-ordering to avoid shortages.”
Loadstar is recognised as one of the premier sources of influential analysis and commentary at the highest levels of logistics and supply chain management.
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