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The current container market is facing more than its share of disruptions, notably due to the U.S.-China trade war, increasing tensions in the Middle East and the new emission regulation. We saw peak shipping volumes in early May/June which were spurred by the protectionist tariffs implemented by the U.S. on China origin goods. This led to a space shortage, as shippers rushed to export their shipments to avoid the high tariffs.
Since the trade truce agreed to by the U.S. and China at the June 28/29 G20 Summit meeting, the urgency to ship has somewhat subsided. The steamship lines had implemented blank sailings over the last month to remove capacity from the market to keep their rates from declining. However, with the uncertainty of the U.S. political machine, shippers in China are nervous as they are not sure when the trade policy may change again, so peak season remains very unpredictable. Coupled with the reduction of sulphur in bunker fuel (IMO 2020), this creates volatile fuel prices. This year will most certainly prove to be a very interesting and challenging one for shipping ocean freight.
For more information, contact Debbie McGuire, Manager – Freight Solutions.
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