Rates on Asia-Europe continue free fall
The important Asia-Europe continued its dive for the tenth week in a row, declining 4 percent, down to USD 641 per twenty-foot container, writes analysts Fearnley.
The now confirmed rate war among the major container carriers is getting worse, and the rates are now so low that the carriers are no longer making money on transporting cargo from Asia to Europe.
However, the total spot rate index SCFI from Shanghai Shipping Exchange stopped its decline this week, a decline that has otherwise been constant since mid-March. But the strong competition on the route, caused by overcapacity and weak growth, means that the halt didn't reach this route yet, and Maersk CEO Nils Smedegaard Andersen recently commented that the rate war will require further savings from Maersk Line:
"We have to accept the fact that as long as there's overcapacity there'll be price wars. All we can do is shrug and focus on making Maersk Line as competitive as possible, by cutting costs and nurturing our customer relations," he told Ritzau Finans.
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