Chinese transport authorities have intervened to regulate the record container freight rate surge seen on the transpacific.
According to market sources, the Ministry of Transport held a meeting with senior officials from major containerlines last week, demanding to normalise pricing and deploy more capacity to North America.
Splash understands that the ministry does not intend to put out a public ban on price increases.
Last month, Splash reported that Ministry of Transport sent letters to six major containerlines, including Cosco, Maersk, MSC, CMA CGM, Hapag Lloyd and Evergreen, asking them for explanations behind the recent freight rate surges on the transpacific.
When contacted by Splash, an official from Cosco declined to comment on the matter.
A report by the Shanghai Shipping Exchange shows that the rate from Shanghai to the US west coast has reached a record $3,813 per feu, a 1.5% growth compared to the previous week. Currently transpacific container shippers are paying more than three times as much as Asia-North Europe rates.
“The fact that earnings per nautical mile are more than three times as high on the Asia-USWC trade is remarkable, as carriers need fewer resources ships and equipment on a shorter trade,” Alphaliner said in a report from last week.
“We would also not be surprised to see especially the EU competition authorities, as well as the US Federal Maritime Commission (FMC) get involved in the coming months, as well,” analysts at container specialists Sea-Intelligence suggested in their latest weekly report.
I assume that the Chinese and EU Authorities will also be asking shippers to pay more as and when freight rates fall below what is required to sustain operations and investment? Container Lines have had awful ROI’s over the years and shippers should get used to paying rates that reflect the investment and returns required by operators.