Asia-Europe Carriers Push Ahead With June GRIs

Asia-Europe carriers are planning a new round of hefty general rate increases (GRIs) in June, despite a downward trend that sees the increases losing steam after a week. According to analysts, spot rates from Shanghai to North Europe lost $214 per 20-foot container (TEU) late last week at 32 percent, the largest ever weekly fall in percentage terms that took prices down to $444 per TEU. The rate is now $531 per TEU less than it was in early January, and 68 percent less than during the same week last year.

Undeterred, CMA CGM, Hyundai Merchant Marine and OOCL will levy a $1,000 per TEU GRI from June 1, with OOCL implementing a $2,000 per  forty-foot container (FEU) at the same time. Maersk Line will raise its rates by $800 per TEU from June 1 and on June 5. Hamburg Sud will charge $900 more per TEU and $1,800 extra per FEU. Weak demand from both major markets and the emerging economies was being compounded by the large number of container ships that are due to be deployed on the Asia-Europe routes.

On the Asia-U.S. trades, the Shanghai-U.S. East Coast spot rate remained relatively stable, falling 2.3 percent to $3,141 per 40-foot container. This is consistent with increased demand on the all-water route that has seen ports on the East Coast reporting double digit growth in April, with trans-Pacific spot rates down 7 percent to $1,412 per FEU. This East Coast growth is reflective of the diverted cargo from West Coasts ports during the labor disputes early in 2015, which concluded with a ratified agreement on May 22nd.