dreamstime_s_40471409
© Schulzhattingen

Container spot rates from Asia to Europe and from Asia to the US west coast are around 30% lower than 12 months ago, while fuel costs have jumped over 20%.

Most carriers claim it is “too early to say” at what level rates will settle, or ...

To read this article you need to subscribe.

Help us to continue to invest in award-winning independent journalism. For an introductory offer of just £70 a year, or £10 per month, get access to all our daily news stories and opinion. If you are already a registered user, please login below with your current account's email and password to subscribe. If you are not registered and want to subscribe, please register below to subscribe.
Current subscriber
New subscriber

Comment on this article


You must be logged in to post a comment.
  • Gunther Ginckels

    April 03, 2018 at 2:43 pm

    Fuel cost is the least of container carriers “challenges”. The Trump doctrine on Trade and expected Chinese response, the OBI development, the mergers of Chinese and Japanese carriers all eager to boost marketshare at any cost and last but not least irresponsible new-building programmes for 20,000 TEU++ ULCC’s. If you have some dollars to invest – stay far, far away from container shipping.

    • Ale Pasetti

      April 09, 2018 at 5:36 pm

      Very good points, Gunther. But I’d also add that when one thinks of Maersk, for example — whose stock has plummeted over the past few week — well… then one could argue that most of those risks are priced in at current levels. I wonder, though, how much additional downside you predict from here in terms of capital depreciation stemming from macro risk/dividend cuts and so on?

      • Gunther Ginckels

        April 11, 2018 at 2:40 pm

        Maersk shares have traditionally been long-term investments for Danish farmers and pub-owners. The Moller family still owns 70%+ and are less interested in dividends. While nobody ever dreamed to quantify the capital appreciation it would be unwise to predict capital depreciation. Fact remains that it is not the right time today to enter into AP Moller shares. If you have shares – stick to it and let it go.

  • ne

    April 03, 2018 at 2:44 pm

    Hapag’s guidance was completely clear. Rate increases were ‘ at least enough’ to cover higher bunker. I guess this doesn’t fit with the negative tone though…

    • Mike Wackett

      April 04, 2018 at 9:02 am

      Hi ne,
      In H-L’s outlook it states:
      – Average freight rate, on previous year’s level
      – Average bunker consumption price, increasing clearly
      However, in the Q&A R H-J told Credit Suisse, “we do expect to see recovery of bunker…even if passing it on typically takes 1 or 2 quarters”
      For Hapag and others the erosion of the freight rates for spot business is significant and they need this to turn quickly.

      • Ale Pasetti

        April 09, 2018 at 5:28 pm

        “Freight rates can be managed only to a limited degree because they are heavily dependent on market capacity and market demand.” Hapag noted in its annuals, adding that the sharp y-o-y increase in average bunker consumption prices impacted “negatively on the earnings position” of the group. Not beautifully written, but I think it’s clear!