• ITVI.USA
    13,809.570
    -6.010
    0%
  • OTRI.USA
    21.480
    0.000
    0%
  • OTVI.USA
    13,784.050
    -7.950
    -0.1%
  • TLT.USA
    2.810
    0.000
    0%
  • TSTOPVRPM.ATLPHL
    2.480
    -0.170
    -6.4%
  • TSTOPVRPM.CHIATL
    3.070
    -0.210
    -6.4%
  • TSTOPVRPM.DALLAX
    1.370
    -0.090
    -6.2%
  • TSTOPVRPM.LAXDAL
    2.280
    -0.210
    -8.4%
  • TSTOPVRPM.PHLCHI
    1.900
    -0.070
    -3.6%
  • TSTOPVRPM.LAXSEA
    2.720
    -0.270
    -9%
  • WAIT.USA
    127.000
    0.000
    0%
  • ITVI.USA
    13,809.570
    -6.010
    0%
  • OTRI.USA
    21.480
    0.000
    0%
  • OTVI.USA
    13,784.050
    -7.950
    -0.1%
  • TLT.USA
    2.810
    0.000
    0%
  • TSTOPVRPM.ATLPHL
    2.480
    -0.170
    -6.4%
  • TSTOPVRPM.CHIATL
    3.070
    -0.210
    -6.4%
  • TSTOPVRPM.DALLAX
    1.370
    -0.090
    -6.2%
  • TSTOPVRPM.LAXDAL
    2.280
    -0.210
    -8.4%
  • TSTOPVRPM.PHLCHI
    1.900
    -0.070
    -3.6%
  • TSTOPVRPM.LAXSEA
    2.720
    -0.270
    -9%
  • WAIT.USA
    127.000
    0.000
    0%
American Shipper

Few positive indicators for liner carriers

   Liner carriers will likely have to increase their strategic use of slow steaming and idling of ships to overcome supply side pressures, a new report from Drewry Maritime Research suggests.
   Drewry’s annual Container Market Review and Forecast 2012/13 offers that the industry will remain in transition mode until at least 2014 and probably 2015.
   “How well the operators manage capacity deployment during this time will largely determine where freight rates and overall profitability settles,” Drewry said. “The new reality for the industry is that there are few genuine positive indicators out there – demand is weak and will remain so on the core headhaul trades for the next 15 months at least, the charter market is showing no signs of a pick-up, freight rates are under pressure and the cascade of tonnage through the system is starting to cause issues.”
   A relative paucity of capacity removal on the Asia-Europe, and difficulties for some carriers in cascading larger ships to secondary North-South trades shows the influx of larger ships won’t seamlessly be incorporated, even as the industry refrained from major capacity expansions.
   “Given the number of factors shaping the industry, carriers seem to want the best of both worlds,” said Neil Dekker, Drewry’s head of container research. “They firmly believe that deploying ever bigger ships across all the major trade lanes is the way forward, and yet by doing this they cannot forget the likely negative influences on freight rates. The industry faces the fundamental challenge of aligning supply with demand in order to keep freight rates at healthy levels and yet at the same time relatively few carriers are prepared to take the lead and adjust capacity – or if they do, it is always on a reactive basis.”
   Drewry said it is likely there will be a natural realignment of capacity and operational alliances, as has already happened on the Asia-North Europe route, as carriers grapple with low demand growth on their core lanes.
   “This will happen out of necessity as carriers are forced to change their commercial strategies,” Drewry said.
   “Now is the time for carriers to deploy service patterns seriously aimed at stabilizing freight rates or else the industry will be caught up in a current of falling rates while using the GRI mechanism to paddle upstream against market fundamentals,” Dekker said. – Eric Johnson