For all the apparent problems in Europe right now, and fears of economic stagnation as a result, one might be surprised to hear that container shipping rates are soaring for Asia-Europe trade. (Chart to the right, via Citi)
Rates are rising because volume of trade has picked up. Moreover, the shipping industry expects growth to continue… which is why they’re now adding more ships to Asia-Europe routes for the first time in a long while:
Ocean container carriers are significantly boosting cargo capacity on Asia-Europe shipping lanes for the first time in 18 months, threatening to reverse recent strong gains in freight rates. New service launches will add around 22,000 20-foot equivalent units to the trade, representing around 7 per cent of total capacity, according to Alphaliner, the Paris-based consultancy. “This is the first major influx of capacity onto the Asia-Europe sector since the start of the financial crisis in September 2008,” Alphaliner said.
The additional services will ease the capacity crunch on the Far East-Europe market, which the trade has faced since late December.
Europe may look like it is ‘dying’, but they’re still voraciously consuming Asian goods.
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