Posted on June 18, 2024
Global shipping news

Weekly Shipping & Logistics News Wrap, Week 25 

Top Highlights

  • Ocean freight rates soar 
  • High demand for container ships persists 
  • Container charter market thrives 
  • Record low containers lost at sea 
  • Strikes threaten German and French ports 

Ocean Freight Rates May Surpass $20,000 with No Relief in Sight 

Global trade faces another hurdle as ocean freight rates threaten to exceed $20,000 per container, potentially peaking at $30,000. Rising costs from the Far East to the U.S. saw a 36%-41% month-over-month increase, driven by general rate hikes of approximately 140%. Experts predict these inflated rates could persist into 2025, creating significant challenges for shippers and the broader supply chain. 

Boxship Newbuild Contracts Extend to 2029 

The demand for new container ships remains robust, with delivery contracts now stretching into 2029. Asian shipyards are brimming with orders, especially for LNG carriers and containerships. CMA CGM, for instance, has commissioned a series of 8,000 TEU LNG dual-fuel ships and is in discussions for additional 15,000 TEU vessels. This surge in newbuilds, coupled with increased orders for mid-sized ships, indicates a long-term commitment to fleet rejuvenation. 

Booming Charter Market Driven by Mid-Sizes 

The container charter market is experiencing unprecedented growth, particularly in the mid-size sector (4,000-9,999 TEU). Charter rates have surged 100% since mid-December, fuelled by geopolitical tensions and market dynamics. Longer charter periods, some extending to 36 months, reflect the high demand for these vessels. Additionally, the ongoing conflict in Gaza has redirected shipping routes, further straining mid-sized tonnage availability. 

Containers Lost at Sea at Record Low Levels 

The World Shipping Council reports a historic low in containers lost at sea, with only 221 containers lost in 2023. This decrease underscores the industry’s dedication to enhancing safety measures and regulatory compliance. The new mandatory reporting requirements set to take effect in 2026 will further bolster navigational safety and environmental protection. 

Strikes at German and French Ports Threaten Congestion 

Ongoing labour disputes in Germany and France could disrupt European shipping operations. German port workers are pressing for wage increases, while French dockers protest pension reforms. These strikes, if prolonged, may force shippers to reroute through less congested ports like Antwerp and Rotterdam, potentially leading to significant delays and congestion. 

House of Shipping Insight 

The current landscape of the shipping and logistics industry is marked by both challenges and opportunities. Rising ocean freight rates and extended newbuild contracts indicate a strained supply chain, yet also a resilient market poised for long-term growth. The booming charter market and record low container losses reflect the industry’s adaptability and commitment to safety. However, labour disputes in key European ports underscore the ongoing need for negotiation and cooperation to ensure smooth operations. At House of Shipping, we remain committed to navigating these complexities, providing our clients with strategic insights and robust solutions to thrive in this dynamic environment. 

Weekly Shipping & Logistics News Wrap, Week 25 

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