MÄRKTE |
MÄRKTE | MARKETSContainer market buzzing againIt’s a busy close of the year for container shipping with a fully-employed fleet and little prospectof a return to normality. By Michael HollmannCapacity in container shippingtightened again after the GoldenWeek with freight rates firming as cargovolumes picked up. While geopoliticaltension, port congestion and an exportrush ahead of Chinese New Year (29 January)are expected to keep shipping operationsunder maximum pressure in theshort run, market players also seem tohave adopted a more positive outlook forall of next year.None of the major carriers and allianceshave signalled a return to the RedSea on their east-west services, meaningthat lengthened trading distances willcontinue absorbing a lot of fleet capacity.At the same time, there are more disruptionslooming as contract negotiationsbetween employers and dockerrepresentatives at US East and Gulf Coastports have broken down again. Both sidesremain far apart on the issue of automation,raising the spectre of anotherport strike, possibly longer than the lastone in September, from mid-January. Upnorth in Canada, the government has justended labour disputes on both coastsafter operations at major container portshad already come to a halt due to lockouts.It seems that labour problems areturning into a never-ending story forshipping services to and from NorthAmerica…Charter market keeps climbingNext, there is the question of tariff hikesby the incoming Trump administration:20 % on goods from Europe, 60 % ongoods from China? Although it mayharm trade flows in the long run, the initialeffect could be the opposite: US importersrushing to bring in as much cargoas possible until tariff increases actuallytake effect. No doubt, a sudden surge inloadings would only add more strain onshipping networks that are alreadystruggling to cope with demand.Analysts in the shipping sector (seeviewpoint interview with Drewry below)but also in the financial sector have recentlylifted their forecasts for the containermarket as contract negotiationsbetween shippers and carriers in the FarEast/Europe trade point to another hardeningin rates. Some believe thatcontract rates could even double to2,500–3,000 $/ FEU. It would provide astrong foundation for container linesnext year after profit margins alreadywent through the roof again in this year’sthird quarter.The carriers themselves are teemingwith optimism based on their orderingand chartering activities. Following anotherspike in contracting, the ratio of theorderbook to the fleet in operation hasbounced back up to 26 %, reaching in absoluteterms its highest level ever. At thesame time, lines are fixing charter vesselsfor long periods off forward positions inthe next two years like they only did duringthe corona boom of 2021/22. No onethought this could ever happen again…Consequently, the charter marketkeeps climbing higher totally against seasonality– the ConTex is up 3.6 % monthon-month.Shipbrokers report that theVIEWPOINTIt’s all aboutsecuring capacitySpace shortages in container shipping willprobably not relax next year as geopoliticaltension remains high, according toPhilip Damas, a managing director andhead of supply chain practice at DrewryShipping Consultants in London. Puttingsafe contracts in place to keep cargo movingwill be key for shippers, he says.2024 was another turbulent year in containershipping with the diversion of eastwestservices around the Cape of GoodHope. What can shippers expect in 2025?Philip Damas: All indications are that it’sgoing to be another year of disruptions inliner shipping – for the fifth time in a row!The consensus is that deviation of servicesaround the Cape of Good Hope will continuethroughout 2025 as there is no resolutionof the conflict in the Middle East insight. This will continue absorbing a largeamount of capacity. At Drewry we are basingour forecast for next year on differentscenarios. The base case scenario sees aport strike on the USA’s East and GulfCoast as unions and employers remain farapart on the issue of automation. We seethe likelihood of a strike at 70 %. Dependingon the duration, this will have moderateor severe implications for containershipping worldwide in terms of congestionand delays to schedules and equipmentflows. Further, there will likely be arush in bookings by US importers as theytry to ship ahead of tariff hikes by theTrump administration, causing a surge involume and adding to the pressure on capacity.This might coincide with theplanned reshuffle of liner alliances earlynext year, and we know from previous regroupingsamong global carriers thatthere tend to be teething problems duringPhilip Damas, Head of Supply Chain Advisorsdivision/Managing DirectorDrewry Shipping Consultantsthe ramp-up of new vessel systems. As aresult, we forecast global fleet utilisationto edge even higher from 84 index pointsthis year to 85.2 next year, with 100 indicatingmaximum utilisation of the fleet allthrough the year.© Drewry12 HANSA – International Maritime Journal 12 | 2024
15001250100023.05.24750ConTex21.11.24 TMI – Toepfer'sMultipurpose Index November '2312,208 $November '2413,157 $
