The multimodal network news digest - issue #31

The global shipping industry continues to struggle with declining freight rates and high demand to secure long-term contracts with shippers. Carriers brace up to do whatever it takes to maximize profits while the situation allows it. They are offering long-term contracts to shippers while cutting rates even more to attract more customers and fill up the vessels. This strategy is expected to continue in the near future, even as the oversupply of container capacity persists and new mega-ships are added to the fleet, resulting in ongoing rate pressures.

Utilization rates have also been dragging freight rates down across most shipping routes, except for the Atlantic. Back in the day, when utilization was at 90%, spot rates skyrocketed. Now this rate is at the pre-pandemic level and spot rates remain low. As a result, containership lay-ups are continuing to increase due to the demand slump, and major ports are experiencing a significant drop in handled volumes.  Nevertheless, the Port of Los Angeles is hoping for a rebound in the second half of 2023, although together with the Port of Long Beach, they are dealing with shrinking container volumes. In Europe, the brightest example of the same trend is the Port of Rotterdam which started to see a decline in throughput in 2022.

In addition, starting in March,  the shipping industry is about to face an avalanche of new ultra-large container vessel (ULVC) newbuilds, which will bring a whole new set of challenges for carriers such as the need for infrastructure upgrades, higher operating costs, and the risk of overcapacity. 

Rotes & services 

• Regardless of the market situation, MSC increases rates from March 1 to March 31 across major ports in Asia and Europe. The rates will be up to $1450 for 20 DV and up to $1700 for 40 DV & HC depending on the destination. 
• The new rotation for Samba/SAFRAN and BossaNova/SIRIUS services that are run together by Maersk and CMA CGM: London (UK), Rotterdam (Netherlands), Hamburg (Germany), Antwerp (Belgium), Tanger (Morocco), Santos (Brazil), Paranagua (Brazil), Buenos Aires (Argentina), Montevideo (Uruguay), Rio Grande (Brazil), Paranagua, Santos, Tanger, and London. In addition, BossaNova/SIRIUS will no longer call the Rio Grande port.
• ZIM, Hai An Transport, and Stevedoring Joint-stock Company created a joint venture to operate domestic shipping services in Vietnam. 
• SŽDC has upgraded an important for multimodal transport bridge and tunnel near Děčín to allow larger freight trains to operate between the Czech Republic and Germany.
• France plans to increase combined transport volumes by 60% by 2027  shifting freight from roads to rail and waterways. The plan includes measures such as developing intermodal terminals, investing in rolling stock, and increasing the capacity of rail and waterway infrastructure.
• Hupac has launched a new rail service between the ports of Antwerp and Basel, Switzerland as an alternative, sustainable transportation option for goods traveling between the two countries.

Other 

• The Dutch-flagged container ship Escape got into the fire in the Gulf of Riga in Latvia. The cause of the fire is still unknown. 
• MDL Forwarding has launched a new direct shipping service connecting Russia and  Latin America. 
• The Iskenderun terminal in Turkey is expected to resume normal operations within the next three months after a fire broke out on a vessel following the earthquake, causing damage to the terminal's pier and infrastructure. 
• MSC is set to become the largest shareholder of Trieste Marine Terminal, after acquiring a 49% stake in the company. It will significantly boost MSC’s presence in the Mediterranean region and increase its operational capabilities.
• According to the new data, nearly half of all maritime incidents in 2022 occurred in ports and terminals, with cargo and container handling operations being the most common cause of accidents. Experts underscore the importance of safety protocols and risk management measures in port and terminal operations.

These are only several changes that occurred in more than 250 bn freight rates across 25 million routes with more than 1 million market players. Want to share some news about your company, services, and routes? Just post them on MAXMODAL, a multimodal network that digitally connects routes and rates worldwide to automate sales and operations across container transportation & logistics industry. Join to innovate.