On the major East-West box trades, ocean freight rates might be surging just as the new vessel orderbook for container ships look bare but that does not mean the outlook for carriers will remain bright indefinitely.

According to the latest analysis by Alphaliner, rates on the Asia-Europe trade are particularly vulnerable to new vessel deliveries and a demand downturn later this year.

“The big carriers are currently enjoying strong cargo demand and healthy spot rates on the two biggest East-West trades,” it noted.

However, Alphaliner said how cargo demand evolves after the summer peak season was difficult to predict. “European and US importers might currently be refilling their stocks as they fear new waves of the COVID-19 pandemic, resulting in a flat market after the summer,” it added.

“The delivery of 86 ships over 10,000 TEU capacity is expected to put extra pressure on the Asia to Europe trade as the biggest ships are expected to be deployed there.”

For more including newbuild orderbook chart, LloydsLoadingList reports. 

The impact of the Covid-19 virus outbreak, Lloyd'sLoadingList reports, on container shipping continues to grow, but at a slower pace, according to container shipping consultancy Sea-Intelligence.

Sea-Intelligence CEO Alan Murphy pointed out that the organisation’s 23 February weekly analytical report had estimated a Covid-19 global “demand downfall” of 1.7 million twenty-foot equivalent units (TEU), whereas the updated figures of its 1 March report, which reflects the latest blank sailings, now estimate the volume loss at 1.9 million TEU.

At a rough average freight rate of 1,000 US$ per TEU, this equals a revenue loss of US$1.9 billion for the carriers, Sea-Intelligence noted.

Sea-Intelligence figures indicate that the number of blank sailings in weeks 5-15 of 2020 on the transpacific has increased to 111, of which 48 have been blanked due to Covid-19, and the remainder due to ‘normal’ Chinese New Year capacity management. On Asia-Europe, the number of blank sailings has increased to 75, of which 29 are due to Covid-19, Sea-Intelligence said.

“From a more positive angle, we appear to be seeing a stabilisation,” Murphy observed. “Even though the carriers have announced seven more blank sailings over the past week, which corresponds to an additional 7% removal of capacity, the pace of new blank sailings has clearly declined, suggesting a belief from the carriers that volumes will slowly be brought back to normal levels.”

For more on these developments click here. 

An example of the Covid-19 impact on the Asia-Northern Europe trade market AFLOAT adds is operator OOCL (see photo) which recently has a service update on such operations.