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Box shipping voyages are shelved at the last moment as cargo dries up

CARGO is in short supply with ocean liners cutting sailings and discounting container spot rates from Asia this week

11 February 2020 - 19:00

CARGO is in short supply with ocean liners cutting sailings and discounting container spot rates from Asia this week.

Maersk and 2M Alliance partner MSC were forced to cancel this week's 2M AE7/Swan loop from China to North Europe at the last minute after they were unable to secure enough cargo.



The 19,472 TEU MSC Rifaiya kicked off its loading programme in Ningbo, China on Monday, but instead of sending the ship half-full to Europe, UK's The Loadstar said that it was decided to anchor the vessel.



The 2M partners later said that they would also blank the sailing of the AE15 loop next week, with the 13,050 TEU MSC Ariane due to start loading in Shanghai on Monday.



The Ningbo Containerised Freight Index (NCFI) shows spot rate erosion across all its main components.



For North Europe, the NCFI registered a 7.6 per cent decrease on the week to US$782 per teu, while for west Mediterranean ports, there was a drop of 5.6 per cent to $793 per TEU.



In its commentary, the NCFI referred to the market position for Europe as 'seriously insufficient'.



UK-based forwarder Westbound Logistics has advised customers of a rate reduction in the pipeline valid from February 15, and also warned that there could be upwards pressure on rates in March as carriers deal with the backlog of frustrated orders when production and the logistics industry begins to return to some form of normality.



Westbound advises its customers to plan early 'to avoid as much panic-buying into over-inflated prices'.



Other forwarders are putting out similar messages to their clients and endeavouring to assist them to navigate the significant supply chain disruption from the extended manufacturing closures in China.



Twill, Maersk's in-house digital arm, has recommended its clients delay cargo as long as possible, and consider using air or rail for urgent shipments.



It said: 'We know that demand for shipments following the extended break will be very high and this might impact short-term prices. The more you can delay the shipments the cheaper it will be.'


WORLD SHIPPING

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