A Hapag-Lloyd spokesperson told American Shipper space is tight on the Europe to Asia trade right now from an uptick in volumes, which is abnormal for this time of year.
Source: Oliver Hoffmann/Shutterstock
A Hapag-Lloyd spokesperson said space is tight on the Europe to Asia trade right now from an uptick in volumes, which is abnormal for this time of year.
Carriers say they are seeing an increase in demand for transport from European exporters.
Space is tight from Europe to Asia at the moment, which primarily seems to be from a steep increase in volumes, Hapag-Lloyd spokesperson Rainer Horn told American Shipper. The surge in volumes on the Europe to Asia trade is not typical for this time of year, Horn said. In addition, the eastbound route is normally not even the dominant leg on trade between Europe and Asia.
In 2016, China was the second largest destination for exports from the European Union, accounting for 10 percent of exports (based on trade value), trailing behind the United States, which accounted for 21 percent of exports from the European Union, according to data from Eurostat.
The European Shippers’ Council (ESC) in the past week has complained twice about a lack of capacity on container services to Asia, noting how some shipments have been delayed up to eight weeks. The ESC also said spot market rates are increasing, and “developments are forcing many traders to cancel their existing sales contracts and limit further sales.”
The ESC has questioned whether the capacity crunch was due to:
• A spike in exports;
• The reorganization of ocean carriers from four alliances on major east-west trades into just three alliances;
• Or the large number of blanked sailings from Asia to Europe around Chinese New Year, resulting in space on ships that would normally be departing Europe in recent weeks not being available.
“We at Hapag-Lloyd regret any inconvenience caused by this situation and we are sure that it should improve soon,” Horn said. “As in every service oriented industry, nobody wants to turn down booking requests by customers. On the contrary, it is a natural intention of a carrier to provide sufficient capacity to its customers.
“And let me stress that there is no situation orchestrated by carriers to bring up the price level whatsoever,” Horn added. “This is strictly forbidden under antitrust laws. The partners of an alliance are only allowed to cooperate in operational dimensions, never in commercial regards. They remain competitors in terms of sales and pricing. The severe and sometimes even irrational competition in our industry – together with the financial results of most carriers – in the past years should be proof enough that competition is more than intact in our industry.”
Although Maersk remains a member of the 2M Alliance and is not joining a new alliance, Maersk spokesman Michael Storgaard noted, “The industry is undergoing change. We have seen recent consolidation and changes in alliances. While alliances overall benefit the customer, the formation of a new alliance is disruptive for customers in the short term. When a container shipping line moves from one alliance to another, both alliances need to redo their networks. There will be shorter and longer periods with frequent changes to services and offered capacity and fluctuating reliability.
“Maersk Line will – as always – actively manage its capacity to ensure that we match supply and demand,” Storgaard added. “This is a requirement in order to remain cost leaders and be able to provide and develop competitive services.”
