World Maritime News
Changing trend of increasing container spot rates
Early October, a dramatic decline in eastbound trans-Pacific spot rates was seen as a temporary relief for US importers caused by production cutbacks in China and a continuous influx of new capacity of chartered ships.
Some containerized freight indices show signs that the period of rapid freight rate gains may end. For example, the Shanghai Shipping Exchange figures showed little change in freight rates a week ago, with the Shanghai Containerized Freight Index up just 0.5%. Likewise, rates on the transpacific were little changed at $6,322 per feu, while there was even a slight 0.2% fall on the Asia-Mediterranean trade.
On the other hand, there is a growing variance within the high spot rates paid by shippers on the trans-Pacific and Asia–North Europe, with cargo owners scrambling for vessel space as container shortages and port congestion at both ends of the trade cut available capacity.
Supply chain chaos to bolster carrier finance through 2022
Supply chain disruption could last until the end of the following year, keeping freight rates at elevated levels more prolonged than expected and boosting container line profitability.
Analysts at Drewry said the longer-than-anticipated period of disruption had led it to upgrade its outlook for global freight rates. In addition, there is more robust than expected spot rate movement in the third quarter and a longer supply chain recovery timeline. That is why the analysts upgraded the outlook for average global freight rates (spot and contract) for 2021 to 126%, which is an upward adjustment from 47% in their June forecast. In 2022, they expect spot rates to decline, but there will be a significant increase in contract pricing, leading to a rise in average global pricing of about 6%.
Boxship order book hits record high with 5.6m teu in the pipeline
The surge of newbuilding activity that started in the fourth quarter of 2020 is likely to tail off as fears emerge of a capacity glut when those orders enter service.
“Spectacular container shipping market conditions and powerful sentiment have seen a record-breaking boxship investment surge,” Clarksons said. “Newbuilding contracting in the year to the end of September 2021 has exceeded all previous annual contracting records in teu terms.”
“Against the backdrop of a record-breaking surge in order book capacity, material supply-side pressure from 2023 is now widely expected. At 2.2m teu, the current 2023 order book delivery schedule is equivalent to 8.6% of the 2023 fleet. In addition, 2024 will also see significant containership capacity delivered, with 1.9m teu scheduled for delivery, as at the end of September 2021.”
Read more: Lloyd’s List
Supply chain disruption absorbs container ship capacity
Containership capacity equivalent to 12.5% of the global fleet is unavailable due to delays caused by congestion in ports, despite the massive increase in deployed tonnage. An analysis of vessel delays and capacity deployments by Sea-Intelligence showed that the amount of capacity being held up out of service as it awaits berthing slots exceeded the amount of additional space required to meet demand.
Carriers planned to increase the capacity of container vessels in the fourth quarter on Asia-Europe, which looks impressive. Still, port congestion delaying ships and upending schedules reduces the extra space significantly.
Regulator mulls intervention in US west coast boxship congestion
Federal Maritime Commission reviews congestion in the ports of Los Angeles and Long Beach, a move welcomed by key stakeholders along with the bottle-necked logistics and supply chain. The US government is investigating record-breaking congestion in both ports. The number of ships at anchor remains persistently high as the importing peak season begins. Federal Maritime Commission chairman Dan Maffei visited the area to gain a “more full view” and an understanding of the “complexity” of what is going on.
Anticipation on IMO Strategy for net-zero emissions
As EU states are pushing for net-zero emissions by 2050, 45 states could theoretically command a majority inside the IMO next month. But due to political bargaining and battles, such ambitions are likely to be deferred until member states agree upon a more detailed revision of IMO’s strategy.
The International Chamber of Shipping has called for shipping’s global regulator to commit the industry to net-zero emissions by 2050 as pressure grows for shipping to catch up with other sectors. Adopting the target would require the votes of the IMO’s 174 member states.
An alliance of 150 industry giants urges governments to get behind a global initiative to decarbonize shipping by 2050.
Maersk invested in a start-up developing another alternative fuel
Maersk Growth, the investment arm of AP Moller-Maersk, has taken a minority stake in US-based Prometheus Fuels, a start-up developing an innovative technology to produce carbon-based electro-fuels from direct air capture.
Maersk expects synthetic alcohols and other electro-fuels to play a role in shipping decarbonization due to its long-term scalability advantages compared with bio-based fuels.
Electro-fuels produced from renewable energy, water, and ambient carbon dioxide captured from the atmosphere have the potential to offer “infinite availability regardless of geographic scope.
Read more: Lloyd’s List