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Container market still competitive

With nearly 400 different vessel operators plying their trade worldwide there is plenty of competition and potential for more M&A activity. The collapse of freight rates during the second half of last year, far out of line with the underlying supply and demand fundamentals, suggests that carriers have not yet rid themselves of certain self-sabotaging traits and that talk of a new golden age for carriers was perhaps exaggerated.

However, despite the recent developments, in the latest Container Forecaster report Drewry retains it view that the carriers are heading towards a brighter future, while also acknowledging there are several temporary factors that have created a bump in the road to recovery.


Ships demolition market: wait and see approach

The balance of things appears to be fragile in the demolition market, as cash buyers, scrapyards and ship owners are tangled in a “wait-and-see” approach over the market’s future trends. Even so, some parts of the market are still very robust in terms of activity. According to the latest weekly report, the quiet start to the year has continued over the course of the past week, although it is now starting to see a glimpse of things to come where there have been several more vessels being talked around in the market, particularly larger tanker units such as VLCC‘s.

Baltic index drops to 5-month low on sinking capesize rates

The Baltic Exchange’s main sea freight index, tracking rates for ships carrying dry bulk commodities, fell nearly 5 percent on Wednesday to its lowest in over five months due to tumbling capesize rates. The overall index, which factors in rates for capesize, panamax, supramax and handysize shipping vessels, slid 57 points, or 4.7 percent, to close at 1,164 points, the lowest since Aug. 14.

The capesize index fell 267 points, or 13.28 percent to 1,743 points, its lowest level since Aug. 9 last year. Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes such as iron ore and coal, fell $1,983 to a more-than-five-month-low of $13,175. The panamax index eased by 12 points, or 0.9 percent, to end at 1,317 points.

Haropa scores record 3m TEU in 2017

Haropa handled a record three million TEU in 2017, with container traffic up 15 per cent and overall seaborne trade up six per cent compared with a year earlier. The figures were the best recorded among north European ports. Hinterland container traffic rose by seven per cent year on year to two million TEU, while transshipment volume increased by an all-time high of 39 percent.

The strong performance was attributed to the overall development of Haropa’s logistics sector which combines high-performance cargo transit with fully developed and connected logistics zones and multimodal inland transport services, reported American Journal of Transportation.


Asia’s Iran oil buyers shrug off impact of potential US sanctions

Asian importers of Iranian oil reacted coolly on Monday to the possible reimposition of US sanctions against Tehran later this year after President Donald Trump on Friday maintained the 120-day waiver, but said it was for the final time and the last chance to rewrite the nuclear deal.

Trading sources from Asia, which remains the premier destination of Iranian oil, told that even if US sanctions returned, crude oil inflows from Iran would be stable. Some market players believe the return of sanctions targeting Iran’s oil sector could also take months, if not a few years, to be fully implemented.

Container supply chain players braced for further price hike

Container supply chain players were braced for another head-haul price hike on January 15 potentially between $300-$500 for the North Asia to North American and North Continent routes.

For most carriers, cargo utilization and trade demand is strong as Chinese New Year approaches. Any carriers offering below these proposed increases could stall the upward price momentum in the spot and annual contract box prices by a week. This looks set to occur on the North Asia to West Coast North America route because certain carriers are not as full cargowise as their competitors and may have chosen to extend their validity instead of the previous issued price increase for January 15. This week most of S&P Global Platts’ routes remained unchanged except North Asia to West Coast North America which dropped $50 to $1,400/FEU this week.

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