MARITIME NEWS UPDATE WEEK 14/2022

 INFOGRAPHIC SOCIAL-ECONOMIC SITUATION IN THE FIRST QUARTER OF 2022

(Source: Vietnam General Statistics Office)

MORE NEW BUILDINGS AND CONTAINERS ON YANG MING’S HORIZON

Yang Ming Marine Transport plans to build more ships and containers this year, as it remains optimistic about the freight environment.

Yang Ming’s vessel at TCIT berth.

At a press conference on 30 March after the release of the Taiwanese liner operator’s 2021 financials, the company's director Chang Shao-Feng said that more than 15,000 TEU ships will be ordered to meet demand on the Asia-Europe and Transpacific lanes, which are Yang Ming’s main revenue generators.

In 2021, Yang Ming enjoyed record earnings as the liner industry saw a second straight year of all-time high profits.

Chang commented, “This year will still be favorable to shipping companies as capacity remains tight. However, as new ships are delivered one after another in 2023, the supply may exceed demand, but it still depends on the Covid-19 situation, whether there is an improvement in port congestion.”

Yang Ming is also considering ordering some feeder ships with individual capacities of 1,200 to 1,800 TEU. Additionally, the company will take delivery of 40,000 new containers by the end of this month, and plans to order another 30,000 in the second half of 2022.

Chang admitted that the uncertainties arising from the Russia-Ukraine war had placed downward pressure on freight rates, and while 20% of Yang Ming’s Asia-Europe shipments and half of the company’s Transpacific volumes are tied to long-term contracts, contractual rates have been reduced in recent negotiations.

He added that Shanghai’s lockdown, which began on 28 March, has disrupted supply chains, causing Yang Ming to divert some ships to other ports that are also facing high demand.

Chang said, “We believe that this year, freight rates won’t increase as much as last year, but if the capacity shortage continues, there’s a good chance that freight rates will stay high.”

(Source: Container News)

OCEAN NETWORK EXPRESS UNVEILS $20BN INVESTMENT SCHEME

Jeremy Nixon, CEO of Japan’s Ocean Network Express (ONE), gave reporters an idea of what it will cost to stay mixing with the big boys of the liner profession, outlining major investment plans over the next eight years at a press briefing yesterday.

Ocean Network Express (ONE) – Valued partner of TCIT.

By 2030, the carrier will invest $20bn, of which more than half will go into new containerships. Other investments include terminal acquisitions, technology, and other segments such as containers.

To meet the growing demand and decarbonization target of 2050, ONE plans to invest in around 150,000 TEU of new building capacity each year. ONE has already chartered 38 vessels, which will be deployed from 2023 to 2025. The move will see ships that are due to come off charter and provided by the parent companies replaced.

“Last year, 75% of our fleet was chartered from our shareholders and, by 2030, this will be reduced to 20%,” Nixon said.

ONE, with 1.58m slots to its name today, is currently the world’s sixth-largest container line, according to data from Alphaliner. It was created in 2017 by Japan’s big three shipping lines, K Line, MOL, and NYK, as container consolidation forced many shipping companies to seek out mergers to remain competitive.

(According to Splash247)

 CONTAINER FREIGHT RATES FOR THE ASIA-MEDITERRANEAN ROUTE REMAIN STABLE UNTIL THE END OF THE YEAR

Xeneta forecasts that container shipping prices on the Asia-Mediterranean route will remain stable this year.

Spot freight rates on the Asia-Mediterranean route have remained at around 14,000 USD/FEU, this is the rate that has been maintained since the end of September 2021. Meanwhile, the rate for long-term contracts is 9,000 USD/FEU.

While freight rates on the Asia-Mediterranean route remained stable, freight rates for the Asia-North Europe route fell in the first months of 2022.

“In the second half of 2021, spot rates to North Europe from the Far East were on average $860 per feu higher than those to the Mediterranean, while long term rates were $1,350 per feu higher. In the first two and a half months of 2022, the gap between the two has again fallen, and on the spot market… leaving them cheaper than the shorter journey to the main Mediterranean ports and hubs," said Peter Sand, head of analytics at Xeneta.

The narrowing of the freight gap between the two routes to the Mediterranean and Northern Europe will make Mediterranean ports less attractive to shippers who are looking to save costs by using cheaper shipping services to the Mediterranean and then continue to ship the goods to Northern Europe. “Switching to importing through Mediterranean ports instead of sailing further North will not offer any substantial discount on freight rates for shippers,” said Sand.

Xeneta says that higher rates are supported by disruptions in the transportation industry, not by increased volumes. In addition, the recent COVID-19 lockdowns in many parts of China threaten to upset the balance seen in recent months.

“Despite the softening in spot rates to North Europe in March, the latest COVID lockdown in southern China may leave both shippers and carriers again having to find solutions to new problems quickly. Should the situation deteriorate further, it may stop the current trend of softening spot rates,” Sand said.

(Source: Phaata)