By Mike Wackett

(The Loadstar)– The container market has actually been “turned on its head” by the collapse of Hanjin Shipping, according to Oslo- based sea products price benchmarking system Xeneta, which claims maybe a “wake-up” require large-volume carriers accustomed to lasting agreements at reduced prices.

Some experts recommend the 40-50% spike in Asia-Europe and also transpacific container area prices that adhered to Hanjin’s entryway right into court receivership on 31 August, will certainly be brief, provided the fundamental architectural overcapacity of the marketplace.

But, with the advantage of responses from its 600-strong worldwide organization customer area, Xeneta thinks sea providers will certainly “not be so accommodating” after listening to cases of container lines damaging contracts on low-rated agreements.

“The Hanjin saga has the potential to redefine the container shipping landscape,” stated Xeneta president Patrik Berglund.

“Hanjin’s failing caused an instant capability decrease of approximately 8% in transpacific and also Asian-European paths, and also this provides rivals a noticeable fillip.

“The feedback we’ve received from our community details rising rates, stretched capacity, claims of broken contracts – when agreed at low prices – and a need to go to the spot market, where quotes of between one and three months are not being contracted,” stated Mr Bergland.

“In many ways the market has been turned on its head. Now it’s the liners flexing their muscles again.”

He included: “Short-term rates were already rising on the main Far East Asia to North Europe route, the world’s most important trade channel, since hitting lows in March. Then, the market average price for a 40ft container stood at $552. In late August, it climbed to $1,172 and now it’s $1,834. Transpacific routes have climbed from $839 in March to $1,887 now.”

The expert alerted that also the greatest carriers can deal with some difficult settlements in the coming months and also discover that the tables have actually transformed considerably in favour of the providers.

Mr Berglund stated: “As the year pertains to an end the tendering/bidding period begins for lots of European carriers. This will certainly be a wake-up phone call for the large-volume carriers that have actually possibly ended up being familiar with indulging in lasting agreements at reduced prices.

“In a changed market, the carriers won’t be as accommodating. Last term’s prices will suddenly be a distant memory.”

The weak point of the marketplace at the end of 2015, which proceeded right into the initial 2 quarters of this year, badly affected January to December agreement prices for Asia-Europe and also May to April transpacific agreement settlements.

But carriers are stressed that the unexpected collapse of the globe’s seventh-biggest container line and also South Korea’s greatest service provider, with months of interruption and also massive price to the supply chain in its wake, can be adhered to by others– providers currently in economic distress as financiers and also loan providers reassess approach.

After years of sector red ink, the “too-big-to-fail” bubble of leading 20 container lines being propped up by financiers and also federal governments, despite losses, appears to have lastly ruptured.

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