Thursday, June 17, 2010

Maersk sees unprecedented container shortage

Maersk Line, the world’s biggest container shipping group, said today a strong rebound in global trade has led to an unprecedented shortage of containers as shipping enters its peak season.

Maersk Line, part of Danish oil and shipping group A.P. Moller-Maersk, announced unusually high peak season surcharges on freight rates from Asia to Europe last week.

“The present market situation is unique,” Lars Reno Jakobsen, head of Network and Product and member of Maersk Line’s management board, said in a statement.

“We are experiencing a demand surge in most trades, which is a development that is both unprecedented and unexpected by us and our customers,” Jakobsen said.

The Asia-Europe trade is growing by 23 per cent year-on-year, outpacing the market’s 3-6 per cent forecast from six months ago, he said.

“We expect an even more pronounced and serious shortage of containers in the coming months as we enter the peak season,” he added.

After a plunge in the market from late 2008 through last year, the global shipping industry is recovering with world trade.

“Maersk Line expects the equipment (container) shortage to last through the third quarter of this year and will continue to work closely together with all stakeholders, not least our customers, to further reduce equipment turnaround times,” it said.

During the slump of 2008-2009, many container shipping and container leasing companies stopped sourcing and producing containers, Maersk said.

“As carriers and shippers did not expect the current demand surge, the necessary equipment has not been ordered in 2010, ultimately resulting in the global shortage in equipment,” it said.

In response to the equipment shortage, Maersk Line has begun producing new containers and leasing containers, it said.

It has also re-activated laid-up vessels to help reposition containers as fast as possible from, for instance, the east coast of North America and Latin America to Asia, it said.

Last week, Maersk Line announced a peak season surcharge (PSS) for the Far East-Europe trade applicable from July 2010, Maersk said.

The surcharge will help Maersk recover the higher costs caused by the increased volumes and equipment shortages, such as port costs and costs of extraordinary vessels deployed to reposition containers, Maersk said.

Maersk said it would apply only one peak season surcharge so it would not announce separate surcharges or rate increases in connection with the peak season.

Source: Malaysian Insider

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