Port of Incheon loses Russian and African links as MSC, PIL pull services
MSC has suspended its KAMC service, which connected South Korea’s Incheon port with Russia’s Kamchatka ...
The 2M alliance is preparing to blank three Asia-North Europe sailings next month, as export demand from China plummets and container spot rates come under increased pressure.
2M partners MSC and Maersk have cancelled their Griffin/AE55 loop for the first week of May and will void two voyages of their key Shogun/AE1 service in the following weeks.
MSC attributed the cancelled headhaul voyages to “the ongoing market situation” and said bookings would be accommodated on “alternative services”.
The blankings by the 2M and two other alliances are seen as a bid to halt the slide in rates as cargo bookings from China have tanked, due to Covid lockdowns and intermodal restrictions.
According to The Loadstar’s sources, export bookings for the coming weeks have fallen by over a third, as many factories, warehouses and depots remain shut in the Shanghai area and trucking is difficult to find.
Today’s Ningbo Containerized Freight Index (NCFI) commentary reported that some Asia-North Europe carriers had begun to “cut prices” to increase their bookings, but so far, the impact on the spot rate indices has been minimal and in keeping with the normal weakening in the period after the Chinese New Year and before the start of the peak season.
The North European reading for Xeneta’s XSI fell 4%, to $10,849 per teu, while Drewry’s WCI and the Freightos Baltic Index (FBX) declined by around 2%, to $10,364 per teu and $11,659 per teu, respectively.
Vespucci Maritime’s Lars Jensen said the “baseline assumption” was that rates would “continue to slide some 5% before starting to pick up again towards peak season”.
Meanwhile, on the transpacific, spot rates this week were stable, with little or no change in the readings of the US west coast components for the WCI and XSI, at $8,758 and $8,595 per 40ft, respectively, or the FBX (which includes premium fees) at $15,552 per 40ft.
The impact of the hobbling of Chinese production was reflected in the number of import containers arriving at the port of Los Angeles, down by around 20% this week on the same week of 2021, according to its Signal data platform. It also suggested volumes arriving at the west coast hub next week would be some 16% lower than a year ago.
However, the lull in the flow of imports has reduced the waiting times for vessels significantly, with Signal data recording an average wait time for a berth and work for a vessel at LA to 2.7 days.
Nevertheless, CNBC senior editor Lori Ann LaRocco cautions that the surge of containers that will follow when Shanghai is fully reopened will arrive on the US west coast just a few weeks before the expiry of the current labour contract, when, if history is repeated, there could be the threat of industrial action.
“This wave of containers will hit the west coast in June/July, during the last weeks of the ILWU labour contract,” she warned.