Substantial additional capacity is expected to be introduced into the Far East-South America container shipping routes in July, raising the threat of a new rate war on these trades, shipping market analyst Alphaliner said. There are a total of 137 handy neo-panamax containerships of 8,600-10,600 teu on order to date, featuring a Loa of 300 m and beam of 48.2 m. According to Alphaliner, 64 units have been delivered so far, while 73 units are due in the 20 months. A bumper number of deliveries are expected in the next six months, with some 41 units due between July and December 2015. The steady influx of these ships would be mostly aimed at the South American trades. They arrive at a time when FE-South American cargo demand growth is patchy, while freight rates have hit an all-time low. The re-organisation of existing alliances on the FE-WCSA and FE-ECSA trades to be implemented in July will see the launch of five new FE-West Coast South America (WCSA) services, replacing four existing services. Total weekly capacity on direct services serving this route will increase by 11% from 70,500 teu in June to reach 78,000 teu by the end of July, the shipping analyst said. In addition, four new FE-East Coast South America (ECSA) services will be launched to replace four existing strings, with weekly capacity rising by a marginal 1% from 44,600 teu to 45,000 teu (see issue 2015/25 for full new services details). “Although the capacity increase on ECSA will be relatively muted, it reflects the weak demand on the trade, with spot rates from Shanghai to Santos falling to a record low of USD 337/teu, down some 70% compared to a year ago. Meanwhile rates to WCSA are expected to come under pressure in the coming weeks due to the significant capacity expansion on that route,” adds Alphaliner. -Source: worldmaritimenews.com
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Substantial additional capacity is expected to be introduced into the Far East-South America container shipping routes in July, raising the threat of a new rate war on these trades, shipping market analyst Alphaliner said.
There are a total of 137 handy neo-panamax containerships of 8,600-10,600 teu on order to date, featuring a Loa of 300 m and beam of 48.2 m.
According to Alphaliner, 64 units have been delivered so far, while 73 units are due in the 20 months. A bumper number of deliveries are expected in the next six months, with some 41 units due between July and December 2015.
The steady influx of these ships would be mostly aimed at the South American trades. They arrive at a time when FE-South American cargo demand growth is patchy, while freight rates have hit an all-time low.
The re-organisation of existing alliances on the FE-WCSA and FE-ECSA trades to be implemented in July will see the launch of five new FE-West Coast South America (WCSA) services, replacing four existing services.
Total weekly capacity on direct services serving this route will increase by 11% from 70,500 teu in June to reach 78,000 teu by the end of July, the shipping analyst said.
In addition, four new FE-East Coast South America (ECSA) services will be launched to replace four existing strings, with weekly capacity rising by a marginal 1% from 44,600 teu to 45,000 teu (see issue 2015/25 for full new services details).
“Although the capacity increase on ECSA will be relatively muted, it reflects the weak demand on the trade, with spot rates from Shanghai to Santos falling to a record low of USD 337/teu, down some 70% compared to a year ago. Meanwhile rates to WCSA are expected to come under pressure in the coming weeks due to the significant capacity expansion on that route,” adds Alphaliner.
-Source: worldmaritimenews.com