Carriers operating between Asia and North Europe are handling fluctuating and softened trade demand by canceling more sailings and opting for inducement-only port calls, recognizing the need to be more proactive in meeting shipper requirements.
Freight rates from China to North Europe continue to be under pressure, with the market being “oversupplied”, according to the Ningbo Containerized Freight Index (NCFI) commentary. The latest reading of Drewry’s WCI Asia-North Europe component recorded a week-on-week -4% fall in its average rate per 40ft, -86% lower than a year ago.
Ocean carriers serving the Asia-North Europe route are no longer expecting a traditional peak season this year, which has led to downward revisions in their full-year earnings predictions.
Container xChange’s market forecaster for July noted, “The shipping industry enters Q3 with continued rate erosion, as negative market sentiment persists ahead of the invisible peak season.”
“Considering the reduced purchasing power of consumers in the U.S. and EU, demand will be considerably low, compared with the last two years, but better than the previous two quarters in 2023,” the company added.
Source: The Loadstar