Container volumes in the transpacific trade between Asia and West Coast North America jumped 5.5 percent year-over-year in the first six months of 2016, while Asia-Europe volumes ticked up 1.1 percent, according to the London-based maritime consultant.
Global container volumes on selected lanes have grown 2.6 percent in the first half of 2016 compared with the same 2015 period, according to a report from London-based maritime consultant Drewry.
The firm’s report covered the major east-west trades between Asia, North America, Europe and the Mediterranean, as well as north-south lanes – Asia and Europe to the Middle East, South Asia (Indian Subcontinent), Oceania, East Coast South America and West Africa – representing an estimated 40 percent of the world total.
Of the east-west trades, the transpacific lane between Asia and the West Coast of North America showed the most growth in container volumes through the first six months of the year, increasing 5.5 percent to 8.8 million TEUs.
The transatlantic trade between North Europe and North America came in second, growing 2.8 percent from the first half of 2015 to 2.6 million TEUs, followed by the Asia-Mediterranean and Mediterranean-North America trades, which ticked up 1.2 percent each to 3.5 million TEUs and 1 million TEUs, respectively, and the Asia-North Europe lane, up 1.1 percent to 7.2 million TEUs.
The all-water Asia to East Coast North America trade, however, slipped 0.3 percent year-over-year to 3.6 million TEUs for the first half, making it the only east-west trade examined to show negative volume growth.
In the north-south trades selected for the report, the disparity in growth rates was much more pronounced.
The trade between Asia and Oceania led the way with 9 percent growth (2.1 million TEUs), followed by the Europe-South Asia trade at 8.2 percent (1.6 million TEUs), Asia-South Asia at 6.1 percent (2.5 million TEUs), Asia-Middle East at 4.1 percent (2.3 million TEUs), and Europe-Middle East at 2.9 percent (1.6 million TEUs).
First-half container volumes in the Asia to East Coast South America trade, on the other hand, dropped 16.1 percent to 891,000 TEUs compared with the previous year, while Asia-West Africa volumes fell 5.9 percent to 771,000 TEUs and Europe-East Coast South America slipped 2 percent to 761,000 TEUs.
Although the 2.6 percent overall volume growth in the first half may seem modest, it’s still an improvement from the 0.8 percent year-over-year growth seen in 2015. That said, 2.6 percent growth over the full year in 2016 would still represent the third lowest rate since 2000, behind only 2009 and 2015.
Drewry said the still tepid growth rate in the first six months of 2016 is “confirmation – if it were needed – that the days of double-digit growth are long gone.”
Ocean carriers, however, are adapting to the low-growth environment, finding ways to improve vessel utilization through skipped sailings and increased scrapping of smaller ships in an effort to offset the effects of larger containerships being delivered and cascaded into less voluminous trades, the firm said.
Members of the G6 and Ocean3 ocean carrier vessel sharing alliances earlier this week announced they would skip sailings on services in the transpacific and Asia-Europe trades, and containership lessor Seaspan has reportedly offloaded a second 13-year-old containership for scrap.
“Our preliminary research indicates that fronthaul load factors on the main East-West trades was around 90 percent in the second-quarter, up from 86 percent in the same period last year,” which could signal an impending rate increase, Drewry said.
“When load factors are at 90 percent or above, we would normally expect carriers to have more success in raising freight rates,” the firm said. “While rates are trending upwards, their slow pace indicates that supply and demand alone is not dictating pricing and that shippers and forwarders are still the beneficiaries of predatory commercial strategies on the part of carriers.
“Carriers are well accustomed to the slow-growth era of container shipping, proving they can match supply and demand relatively well,” Drewry added. “However, it is a delicate balancing act with very little margin for error, hence why achieving sustained pricing gains has proved to be a more difficult trick to pull off.
Drewry: First-half global container volumes up 2.6% on major trades
