Return of Suez Routes Threatens Efforts to Halt Freight Rate Decline
Ocean Network Express reactivated its Suez route via the vessel 'ONE Continuity', while Linerlytica warned that the return is the biggest threat to efforts to raise Asia-Europe rates.
Ocean Network Express has reactivated its routes via the Suez Canal, becoming the latest major shipping line to return to the route, according to a report by The Loadstar.
The vessel 'ONE Continuity', with a capacity of 8,110 TEUs, is scheduled to transit after departing Laem Chabang port on October 17. CMA CGM, Maersk, MSC, Hapag-Lloyd, and COSCO/OOCL had already begun returning prior to this.
Analytics firm Linerlytica described the Suez return as the biggest threat to carriers' attempts to halt rate declines on the Asia-Europe route.
About 200,000 TEUs of new capacity were injected last month without any vessel removals from service, while MSC announced FAK rates on the Asia-North Europe route starting October 19 at $3,150 per container and $4,500 per 40-foot container.
What do these terms mean?
Freight All Kinds (FAK): A single freight rate applied to all types of cargo regardless of their nature, announced in advance for a specific route.
Twenty-Foot Equivalent Unit (TEU): A unit of measurement equal to a 20-foot shipping container, used to calculate ship capacity and trade volumes.
New Capacity: The additional number of containers entering service when new ships are delivered, increasing supply and putting pressure on rates.
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