Carriers have been managing NVO [non-vessel operator] compliance “much more strictly” in the post-Covid market, forcing them “to revamp their whole sales structures”.  

In the past few years’ ocean shipping contracting, carriers have increasingly been pushing “an almost pervasive use of weekly string or port by port pair allocation plans” to monitor NVO compliance, according to Bob Fredman, principal at SF Global Insights. 

Mr Fredman explained to delegates at TPM25 by S&P Global that a carrier today says to a forwarder or NVO – ’you’re ready to sign the contract? Let’s agree on the allocation plan’.

He said: “It is no longer ‘5,000 feu, great, where do we sign, we’ll figure out the allocation plan later’. It’s like ‘five this week on this lane, and six this week on that lane’. That has allowed the carrier to manage NVO compliance much more strictly.” 

Mr Fredman added that “if a couple of weeks in a row, you miss your five, it gives the carrier the opportunity to say ‘well, sorry, you only gave me two, the market’s strong, I’m only giving you [space for] two”.  

He said this was one way carriers had been able to avoid holding space for long-term contracts, allowing them to improve yields in a more profitable spot market.  

Indeed, Stephanie Loomis, head of ocean freight Americas at Rhenus Logistics, added that the biggest change in behaviour post-Covid was that carriers were “now really sort of forcing [NVOs] to give them a certain percentage of cargo on the spot market”.  

She explained: “The biggest thing you argue about during your contract negotiations as an NVO, is how much of your allocation is going to be based on spot rates and how much of it is going to be based on more of a fixed rate.  

“And as spot rates have remained so high since the pandemic, [carriers] are not disregarding that percentage that you have, but they’re definitely keeping a closer eye on it.

“If you don’t feed them a certain amount of spot business, your NAC [named account] business goes away; they just won’t give it to you. They either won’t fulfil that allocation or it’s a constant communication with them.” 

Ms Loomis also told delegates carriers had become less interested in smaller volumes, which had “forced NVOs to revamp their whole sales structures”. 

“When I first got in the business, it was not uncommon to see an importer with a few hundred, maybe even a thousand, teu capture a named account rate that was very close to what a large BCO would be paying, if they knew the market well enough.” 

“Those days are gone, absolutely gone,” said Ms Loomis.  

After last week’s hiatus, container spot freight rates on the Asia-Europe trades resumed their downward trajectory this week, with prices to both North Europe and Mediterranean ports falling.

The World Container Index (WCI) produced by Drewry, which quotes prices paid over the week, showed rates on the Shanghai-Rotterdam leg down by 5% week on week, to $2,512 per 40ft, as the effects of carriers’ 1 March FAK hikes wore off.

Spot rates on the leg are now some 28% below the same point last year, according to the WCI, and lower than the post-Chinese New Year and Golden Week pricing slumps last year.

Meanwhile, the WCI’s Shanghai-Genoa leg declined 11% week on week, to end at $3,333 per 40ft.

However, spot rate declines on both trades have occurred against a backdrop of relatively strong demand.

According to recently released figures from Container Trade Statistics (CTS), January saw 1.5m teu shipped from the Far East to Europe, an 18.2% increase in volumes over January 2024.

This implies that rising capacity on the trade is outpacing growth, leading to falling vessel utilisation levels, suggested Sea-Intelligence chief executive Alan Murphy.

“On Asia-Europe, utilisation at a monthly level dropped in January 2025, whereas this drop typically only begins after Chinese New Year.

“This is likely a part of the explanation for the early drop in spot rates on this tradelane in January,” he added.

Several carriers have now published new FAK rate levels for implementation on 1 April to arrest the declines. Both Hapag-Lloyd and MSC have set the new FAK rate at $4,000 per 40ft between the Far East and North Europe.

Meanwhile, expectations are that next week will show further declines.

Today’s Shanghai Containerised Freight Index (SCFI), which aggregates spot freight quotes for the forthcoming week, showed a 15% week-on-week decline in China-North Europe rates, and an 8% decline in China-Mediterranean pricing.

“On Asia-North America, there is a clear strengthening of utilisation in January. This trade also saw spot rates hold firm longer than in Asia-Europe, lending credence to the notion that lower utilisation is one of the drivers behind the early drop in Asia-Europe spot rates,” Mr Murphy explained.

However, spot rates continued to fall on the transpacific and Asia-US east coast trades this week. The WCI’s Shanghai-Los Angeles leg finished at $2,906 per 40ft, an 8% week-on-week drop, while the Shanghai-New York trades was down 7% week on week, to finish at $4,038 per 40ft.

Today’s SCFI points to further declines next week, with its US west coast leg down 14% and the east coast leg down 10%.

However, one silver lining for carriers is that backhaul rates may have found their floor, with the WCI’s Rotterdam-Shanghai leg up 1% week on week, to $490 per 40ft, and New York-Shanghai also up 1%, to 854 per 40ft.

These marginal increases have come despite some pretty poor volume data – CTS recorded January Europe-Far East volumes at 484,000 teu, 3.1% down year on year, while North America-Far East shipments were down 9.6% year on year, to 473,100 teu.

In contrast, the transatlantic trade had a robust January in terms of volumes – the headhaul Europe-North America route saw a 10.8% year-on-year gain to 495,000 teu, and the WCI’s Rotterdam-New York leg was up 1% week on week, to $2,373 per 40ft, despite a growing imbalance between demand and supply, which could affect rates in the next few weeks.

“On Europe-North America however, there was a sharp drop in utilisation in January, but curiously, without a major drop in spot rates – at least not yet,” Mr Murphy said.

“The transatlantic is a special animal, not subject to the “normal” market dynamics, but it can’t stay out of sync with supply/demand for too long, so we expect a serious downwards correction in the coming weeks/months,” he added.

US nuclear reactor developer TerraPower and South Korean shipbuilder HD Hyundai Heavy Industries (HHI) are to collaborate to construct small modular reactor-powered containerships.

The aim is to gain a competitive edge over Chinese shipbuilders and become an early mover on carbon-free ships.

The firms said on Tuesday they aimed to finalise development of marine SMR models by 2030 and then commercialise SMR-propelled boxships.

The collaboration comes three months after HHI signed an agreement to supply cylindrical reactor containers to TerraPower to produce sodium-cooled fast reactors.

Sodium reactors are expected to be key components of SMR-propelled containerships, which will run on nuclear power instead of fossil fuel. Mainline operators are said to be interested, as additional cargo can be loaded in the place of fuel cylinders and there is no worry about profitability deteriorating in the face of soaring oil prices.

HHI chief operating officer Kwang Shik-won said: “This agreement marks a transformative collaboration that will accelerate the commercial viability of next-generation nuclear energy solutions and help shape the future global energy landscape.”

Founded by Microsoft pioneer Bill Gates in 2008, TerraPower is building a 345-MW sodium-reactor demonstration project near Kemmerer in Wyoming. The facility, which will supply power to PacifiCorp’s electric grid, could begin operations by 2030.

The agreement coincides with the South Korean government’s plan to capitalise on US President Donald Trump’s protectionist moves against Chinese-built ships.

During a seminar organised by the Korea Shipowners’ Association yesterday, its chairman, Park Jung-seok, touched on the proposed Ships for America Act and Mr Trump’s plans to impose hefty port fees on calls by Chinese-built ships and their operators.

Mr Park said: “If South Korea thoroughly prepares and responds to the US policy, with our know-how, we will be able to turn the current situation into an opportunity.”

Landlocked Hungary has begun construction on its own sea terminal in Trieste, Italy, located approximately 200 kilometers from its nearest border.

The first phase of the 278,000 TEU Adria Port project includes a 250-meter quay, with plans to extend it by an additional 400 meters in the future.

According to Dynaliners report, the project is now expected to be completed by 2028, two

years later than originally scheduled.

This week’s FAK rate hikes introduced by carriers on the Asia-Europe trades managed to arrest 13 weeks of successive spot freight rate declines.

All the major spot rate indices this week showed a slight increase on the trades.

The Shanghai-Rotterdam leg on Drewry’s World Container Index (WCI) increased 2%, week on week to end at $2,636 per 40ft, while the Shanghai-Genoa leg was unchanged, at $3,745 per 40ft.

Xeneta’s XSI Far East-North Europe route showed a marginal week-on-week increase of just under 1%, to $2,733 per 40ft, while the Freightos Baltic Index’s Asia-North Europe increased 1%, to $2,973 per 40ft and the Asia-Mediterranean was up 1%, to $4,177 per 40ft.

Although these levels are considerably below the FAK [freight all kinds] rate of around $4,100 per 40ft to North Europe carriers were seeking with the 1 March increases, lines will find some comfort in the fact that three months of dropping prices have found some sort of floor.

How long that remains will depend on their capacity management over the next couple of months, which, as several speakers at this week’s S&P Global TPM25 conference in Long Beach noted, is particularly difficult while they are simultaneously rolling out new networks.

“Carriers are focused on getting the new networks up and running, which means blank sailings are not as effective as normal, and while this is under way they are also trying to hang on to market share,” Vespucci Maritime’s Lars Jensen told delegates.

However, new analysis of forthcoming capacity changes indicates carriers are on the verge of beginning to reduce capacity from Asia into Northern Europe, while increasing it to the better-paying Mediterranean destinations.

Using MSC’s upcoming proforma schedules as a proxy, liner database eeSea noted: “In Northern Europe, MSC’s expected (aka proforma) monthly capacity dips from an average of 432,000 teu in the six months leading up to the network upheavals, down to 358,000 average monthly teu in May and June, a decline of 17%.

“On the Mediterranean side, the six-month average of 268,000 teu up to January 2025 rises to an average 356,000 teu in May and June – a 25% increase,” head of operations and forecasting Destine Ozuygur said.

In contrast, spot rates on Asia-North America trades witnessed their eighth successive week of price declines – the WCI’s Shanghai-Los Angeles leg was down 9% week on week, to $3,166 per 40ft, while the Shanghai-New York leg decreased 6%, to $4,320 per 40ft.

Meanwhile, on the transatlantic trade rates have largely been flat for the best part of a month, in the range of $2,350-$2,400 per 40ft, according to the WCI, and a number of carriers have announced new FAK rates to be implemented at the beginning of April.

MSC said its new FAK rate on Antwerp-New York would be $7,000 per 40ft from 2 April, from the current $6,000.

CMA CGM also announced a new FAK level of a (weirdly precise) $3,026 per 40ft from Rotterdam to New York for 1 April, while Hapag-Lloyd is set to introduce a peak season surcharge of $750 per 40ft on all shipments from the Mediterranean to the US, Canada, and Mexico from 5 April.

US tariffs of 25% are set to hit Canada and Mexico today, while those on Chinese goods have doubled, to 20%.

Despite some hope there would be a last-minute reprieve, Donald Trump said yesterday there was “no room left for Mexico or for Canada” to avoid tariffs.

“They’re all set. They go into effect tomorrow,” he said. The tariffs will affect more than $918bn-worth of US imports from Canada and Mexico.

The stock market plunged after the announcement, with the S&P 500 falling nearly 1.8% in its worst day since December.

And all three countries look set to retaliate.

China will next week impose tariffs of 10% or 15% on a mix of imported US agricultural products, including meats, fruit, vegetables, and dairy.

Canada said it would immediately impose 25% tariffs on more than $20bn-worth of US imports, with a further $86bn-worth of goods being hit by tariffs in 21 days. Prime minster Justin Trudeau has previously mentioned goods such as bourbon, beer, wine, Florida orange juice, and home appliances.

Mexico is yet to respond, but said it had “a contingency plan”.

Mr Trump also warned of coming tariffs on imported produce, telling farmers, in a social media post, to get ready to sell their goods domestically.

“To the great farmers of the United States: Get ready to start making a lot of agricultural product to be sold INSIDE of the United States. Tariffs will go on external product on 2 April. Have fun!”

The US president also took time last week to suggest that the EU could face a similar 25% tariff on its US-destined exports.

Having claimed the EU had been “screwing the US for years”, Mr Trump said he and his cabinet had “made a decision… and it’ll be 25%, generally speaking”.

However experts from many fields have, in contradiction to the noise from the White House, predicted it would be US consumers that suffer the most from the tariffs, especially those applied to Canada and Mexico.

Columbia Business School professor Brett House said the union between Canada, Mexico, and the US made “North America an incredibly competitive place to build automobiles”.

“You can tap relatively cheap steel and aluminium from Canada, use the relatively low-cost labour in Mexico to assemble cars, and you can leverage the hi-tech expertise and technology of the US together,” he told Time magazine.

Without access to these neighbouring resources, US consumers could see car prices increase by $3,000, with pick-up trucks facing a $10,000 hike.

Such is the threat of looming price increases that Rice University Baker Institute for Public Policy fellow David Gantz added that, with taxes applied each time goods crossed the border, the move would create “an administrative and bureaucratic nightmare”.

Martin Balaam, CEO and co-founder of product information management platform Pimberly, warned that those not importing finished products could struggle, with the impact “being felt much further down the supply chain now”.

He added: “It could be that the impact is hitting them two or three suppliers down the supply chain.”

The Port of Barcelona's Management Board awarded a €72,359,045.87 (around US$75.35 million) contract for constructing the embankment of the new Catalunya wharf to the joint venture of Sacyr Construcción, SA and José Antonio Romero Polo, SAU.

The project, set to take 27 months, involves constructing a sea embankment as the initial phase for depositing materials dredged from the Spanish port docks, the navigation channel, and other ongoing projects such as the Adossat wharf and the new mooring points at the Energy whart.

This foundational work enables the commencement of the Catalunya wharf terraces.

Additional works include the preparation of a terrace for storing and managing construction materials, exemplifying the port's commitment to a circular economy by recycling materials and reducing unnecessary transport.

The primary goal of this reorganization is to equip the Port of Barcelona with the necessary infrastructure to decarbonize port operations and address the maritime and port sector's evolving needs.

The tender for this project was launched a year ago following Spain's Ministry for Ecological Transition and Demographic Challenge's approval of the Environmental Impact Statement

(EIS) in January 2024, with work anticipated to commence this summer.

Container spot freight rates on the main east-west trades saw another week of declines, although, in contrast to most of January and February, the falls this week were led by the Asia-North America trades.

Whereas the weekly falls in spot freight rates so far this year have largely taken place on the Asia-North Europe and Asia-Mediterranean routes, this week saw the steepest declines occur ex-Asia, to the US west and east coasts.

Drewry’s World Container Index’s (WCI) Shanghai-Los Angeles leg saw the spot rate decline 11% week on week, to end at $3,477 per 40ft, while the WCI’s Shanghai-New York leg dropped 10% week on week, to end at $4,593 per 40ft.

In contrast, the WCI’s Shanghai-Rotterdam leg saw spot rates slip just 1% this week, to $2,586 per 40ft, while the Shanghai-Genoa leg was down 2% week on week, to £3,747 per 40ft, providing carriers with some optimism that the spot declines on both trades – ongoing since the beginning of December – may have hit some kind of floor.

Liner analysts largely believe the spot rate declines will continue, given the large amount of new capacity that continues to hit the water on a weekly basis.

“We expect freight rates will continue to soften as vessel supply growth outpaces demand, an end to front-loading, and a return to Suez transits will catalyse this trend,” analysts at MSI wrote this week.

Indeed, they added: “Barring no major black swan event, we believe freight rates will drop substantially over 2025, meaning that GRIs scheduled for March are unlikely to hold, putting the market in a very different position to the highs seen in 2024.”

However, carriers are clearly hoping the GRIs will stick, if quotes for China-UK from the beginning of March are a proxy for the main Asia-North Europe trade. ONE, Hapag-Lloyd, and HMM are offering rates around $4,100 per 40ft, which is bang in line with Hapag-Lloyd’s published 1 March FAK announcement.

At the other end of the scale, however, Maersk is offering $2,500 per 40ft on a pre-paid spot basis, and Yang Ming $3,050 per 40ft, and the expectation among many customers is that rates will continue to come down.

“Carriers are being very bullish – even as rates slide, they deny it and advise they have control and the market is congested,” one forwarder said.

“We will see how long it is before the greasy slope drops rates down to the bottom of the hill.

“Hopefully it won’t – but I can’t see how it can be avoided,” they added.

Container hauliers serving terminals at India’s Nhava Sheva port (JNPA) continue to voice concerns over lengthy vehicle turn times and low productivity.

The pressure on them seems in large part rooted in a mismatch of ocean and landside capacity at the port, which, along with Mundra, accounts for roughly 60% of India’s containerised trade.

Thanks to carriers’ expanding networks and ever-larger box ships, plus exporters trying to maximise shipments before the fiscal year-end on 31 March, Nhava Sheva has seen unusual volume growth of 23% last month, year on year, according to the latest data.

Sporadic vessel-bunching, due to the Red Sea-linked diversions, have also been a factor testing JNPA’s previously seamless port flow, say industry sources.

Despite intermodal rail service enhancements, over-the-road freight accounts for the majority of volumes passing through Nhava Sheva, making quicker vehicle turnarounds critical to its supply chain fluidity.

Truckers mainly blame BMCT, or PSA Mumbai, the newest concessionaire at Nhava Sheva, for the gate slowdown, rejecting its claims that the congestion had been resolved.

“The traffic congestion is causing significant inconvenience to our members, drivers, and the trade community,” said the Nhava Sheva Container Operators’ Welfare Association, which represents truck owners involved in container moves in the harbour.

But PSA told trade stakeholders the “off-and-on congestion” had been a result of volume changes across terminals, rather than through a single terminal.

The Singapore-based operator said: “We will continue to focus on the efficiency of our gates and yard, but there will always be a limit to how much we can handle within a given period of time, and we therefore ask again that we collectively try to avoid the surging which will definitely assist in minimising truck waiting time.”

“We have added the capacity required to handle the expected trade growth and additional demand, but there will always be an issue when trucks swarm to any one of the JNP terminals,” it added.

But the association said that as the trucking delays persist, containers for loading ran the risk of being shut out.

BMCT saw 870 containership calls from April through January, substantially more than the 704 in the period a year prior, and container volumes soared to 1.84m teu, from 1.7m teu, data shows.

Meanwhile, also due to the Red Sea crisis, Nhava Sheva has reported a meteoric rise in transhipment handling, another factor driving the port throughput.

Additionally, major carriers, Maersk in particular, are now using ultra-large container vessels on services out of India, which typically involve more container exchanges per call.

Meanwhile, PSA is close to opening phase 2 of its development at Nhava Sheva, providing a further 2.4m teu of capacity, meaning port capacity is expected to be adequate for near-term cargo volume projections.

But the landside pressure could challenge this if volumes continue to build.

MSC has returned to Zhoushan Changhong International Shipyard for up to eight 21,700 teu LNG dual-fuelled ships, as the Swiss-Italian carrier consolidates its pole position among liner operators.

The yard announced the order on Friday, when it also clarified earlier reports that Greek shipping magnate George Economou’s TMS Dry had commissioned six 11,400 teu LNG dual-fuelled ships – in fact there are 10 firm orders.

MSC’s order is for four vessels, with options for four more, and TMS Dry also has options for four more ships.

MSC has ordered ten 11,500 teu, ten 10,300 teu and a dozen 19,000 teu ships from Zhoushan Changhong over the past three years. The yard said: “We have become MSC’s largest shipbuilding partner. It’s a testament to our skills in constructing LNG-powered boxships.”

The price of the latest order was not disclosed, but according to VesselsValue, the ships are estimated at $220m each. MB Shipbrokers reported that delivery of the first three will be in 2027, the rest the following year.

The vessels commissioned by MSC and TMS Dry will be built according to designs from CIMC ORIC, a unit of China International Marine Containers, the world’s largest container maker.

With the latest order, MSC’s orderbook now stands at more than 2.06m teu, equating to 32% of its in-service fleet. Interestingly, MSC’s orderbook now exceeds ONE’s whole operating fleet, of 1.97m teu.

Meanwhile, CMA CGM, which with an orderbook of 1.32m teu could overtake Maersk Line in the carrier ranks in due course, commissioned up to a dozen (eight firm orders and four options) 18,000 teu ships for $2.5bn at China’s Jiangnan Shipyard two weeks ago, following its order for 12 15,500 teu vessels from HD Hyundai Heavy Industries.

However, Maersk, with an orderbook at 758,622 teu, is reportedly not sitting back and is said to be looking to order another 30 containerships. The Danish carrier has approached to Chinese shipbuilders for up to a dozen 15,000 teu LNG dual-fuelled ships, and shipowner Seaspan is said to be in discussions on newbuilds for long-term charter to Maersk.