Transtar Market Update Sept 2014

10 September 2014

Continued efforts by carriers to impose GRI in the lead up to Golden Week and beyond.

As we suggested last update, the carriers are trying to impose monthly GRI’s in order to gain some increases as distinct from none. The latest attempt on 1 September sought US$300 TEU. Ten days later, perhaps US$100-150 TEU has got through, but this is currently being eroded as the month progresses.

The key period now is, of course, Golden Week when China closes for a week from 1 October. Cargo will surge for the last week of September as it always does prior to disappearing once the factories close. During this period, voyages will be cancelled which is the norm. Beyond Golden Week, vessel blanking returns with a view to matching supply with demand for the last major volume period before Christmas and forcing up rates. This is what has been announced thus far:

» Hanjin week 41: blank sailing, origin vessel cy closing on 14 Oct of Shekou will be cancelled, with no replacement.

» MSK week 41: YOYO service will blank sailing, space swap will be SAS service.

» OOCL week 41: ACE service will blank sailing, space swap will be AAA4 service.

For September, all the loops are operating which is providing around 32,000 TEU capacity per week; demand is currently running at around 26,000 TEU per week. The removal of a weekly sailing should result in some full ships and some juggling to move cargoes.

As regards pricing, another GRI will be attempted for 1 October which will be odd timing in view of the fact that for the next 8-9 days, there will be minimal freight from China.

Again, we will keep you advised as we become aware of developments.