CMA CGM yesterday followed Maersk’s shock price announcement on Monday with a big hike in its Asia-North Europe rates.
The French carrier said from 1 August it would increase its 20ft FAK rate to $1,075 and its 40ft rate to $1,950, which compares with the $1,025 and $1,900 proposed increases by Maersk for 31 July.
Meanwhile, Maersk and 2M partner MSC have announced that this week’s sailing of the 19,462 teu MSC Rifaya from Shanghai on 8 July on the AE55/Griffin loop would be blanked in view of “slowing demand”.
The Danish carrier will no doubt hope that the withdrawal of capacity will help to cement its rate increases, but in the interim bookings on services to North Europe were reported to be “weak”, and carriers have been obliged to heavily discount rates for July sailings.
Moreover, the disappointing start to the peak season for Chinese exports heralds the arrival of a new wave of ultra-large newbuild tonnage ordered in the second half of 2020, much of which is stemmed to be deployed on the Asia-Europe trade.
The timing could not be worse. According to Alphaliner data, a record-breaking 285,000 teu of capacity was delivered in June, including no less than five 24,000 teu-type mega-vessels being phased into Asia-North Europe alliance loops.
In order of nominal capacity: OOCL received the 24,188 teu OOCL Turkiye; ONE, the 24,136 teu ONE Innovation; MSC, the 24,116 teu MSC Nicola Mastro; Hapag-Lloyd, the 23,666 teu Berlin Express; and MSC, the 23,346 teu MSC Mariella.
In all, some 150 newbuild containerships, for a capacity of about 1m teu, were delivered in the first six months of this year, with more than 1.2m teu stemmed for the second half. Against this, just 47 ships, for a capacity of 85,000 teu, were sent for demolition, sending the supply side out of kilter.
Consultant Alphaliner noted that MSC accounted for a staggering 39%, 111,474 teu, of the newbuild deliveries last month, as the Geneva-headquartered carrier puts more tonnage daylight between itself and Maersk.
MSC’s capacity dominance over its alliance partner has now stretched to 1 million teu, helped by its aggressive raids on the second-hand vessel market, where the carrier has snapped-up more than 300 containerships since August 2020.
And with MSC’s huge 1.5m teu orderbook, which includes more ULCVs being delivered this year and next, it remains to be seen how these newbuilds, stemmed to be deployed on Asia-North Europe loops, can be accommodated within the notice period of the 2M Alliance break-up.