Spot rate disparities across ocean trades are encouraging carriers to redeploy assets to maximise returns, reports New York's Journal of Commerce.
Jeremy Masters said carriers like Mediterranean Shipping Co and CMA CGM have acquired secondhand ships in the 2,000??,000 TEU range to serve smaller deep-sea and regional trades. These vessels offer flexibility in shifting between trades with varying profitability.
Spot freight-all-kinds rates per 40-foot container show wide variation. Intra-Asia trades yield US$0.61 per nautical mile, while North Asia to the Indian subcontinent returns just US$0.26. Rates include terminal handling charges and ancillaries.
Masters noted that while spot rates are not preferred by clients, they offer insight into trade attractiveness. Factors such as contract volumes, slot costs, and trade imbalances also affect profitability.
Carriers face challenges in shifting tonnage, including volatility in smaller trades, tight charter markets and costs of redeployment. However, moving ships from over-tonnaged to under-tonnaged trades can improve returns and rebalance supply.
Connecting trades can help spread risk and avoid oversupply. Niche trades may offer steadier returns than volatile East-West routes. First movers in midsize trades can secure market position.
Intra-Asia rate hikes are partly due to diverted US export volumes and port congestion. While robust, current inflated rates may not last.
Masters said ideal trades for entry are those with consistent rates, limited capacity and strong sub-trade connectivity. Carriers with growing fleets of small to midsize ships are best placed to seize opportunities.
He added that bold moves between trades are open to both large and midsize operators.
SeaNews Turkey
Jeremy Masters said carriers like Mediterranean Shipping Co and CMA CGM have acquired secondhand ships in the 2,000??,000 TEU range to serve smaller deep-sea and regional trades. These vessels offer flexibility in shifting between trades with varying profitability.
Spot freight-all-kinds rates per 40-foot container show wide variation. Intra-Asia trades yield US$0.61 per nautical mile, while North Asia to the Indian subcontinent returns just US$0.26. Rates include terminal handling charges and ancillaries.
Masters noted that while spot rates are not preferred by clients, they offer insight into trade attractiveness. Factors such as contract volumes, slot costs, and trade imbalances also affect profitability.
Carriers face challenges in shifting tonnage, including volatility in smaller trades, tight charter markets and costs of redeployment. However, moving ships from over-tonnaged to under-tonnaged trades can improve returns and rebalance supply.
Connecting trades can help spread risk and avoid oversupply. Niche trades may offer steadier returns than volatile East-West routes. First movers in midsize trades can secure market position.
Intra-Asia rate hikes are partly due to diverted US export volumes and port congestion. While robust, current inflated rates may not last.
Masters said ideal trades for entry are those with consistent rates, limited capacity and strong sub-trade connectivity. Carriers with growing fleets of small to midsize ships are best placed to seize opportunities.
He added that bold moves between trades are open to both large and midsize operators.
SeaNews Turkey
