ELAA: Bad timing in EU conference abolition
Europe's abolition of shipping conferences last October didn’t cause the current liner shipping crisis, but the move “could not have come at a worse time for the industry,” said Chris Bourne, executive director for the European Liner Affairs Association, in a speech last week at the Global Shipping Forum in Dalian, China.
Bourne said supply/demand imbalances within the European container trades have been so great in 2009 that the existence of conferences would not have saved the situation.
'However, even if it is difficult, if not impossible to judge, the freefall of rates on the major Asia/Europe trade might not have been so severe if the conference system had still been active in Europe,' he said.
ELAA statistics show the rate of decline in the westbound Asia/Europe trade slowed in the third quarter compared to the second quarter. Trade was off 14 percent in the second quarter compared to 22 percent in the second. But ELAA said its price index still shows rates down in the trade by 40 percent to 45 percent
Bourne said global regulation of shipping remains in flux. While the European Commission in Brussels had hoped that the regulatory bodies around the world would follow its lead in banning Conferences, there is little sign of this happening, he said.
'There is little prospect of a global competition law for the shipping industry in the near future. While we have learned that meaningful dialog with regulators is useful through our experience in Europe, the lines still feel threatened by competition law that certainly lacks uniformity around the world. The lines operate globally but the regulators do not, as yet, have the same global perspective,” he said.