A rise in container spot rates in July on the previous month does not wipe out concerns of overcapacity in the industry, a senior shipping analyst said.
The rates rose about 12% last month on June, largely thanks to general rate increases (GRI) in Asia-Europe trades and an initial success of the same at the beginning of August, which helped the market already towards the end of July.
“The small rate increases do not hide imbalance and a brutal price war. Operators will find a little bit of comfort in Asia-Europe trades, where freight rates reached their highest levels since the end of January, but the high season can only temporarily address the imbalances (between ship supply and demand),” Jacob Pedersen, senior analyst at Sydbank in Denmark said in a monthly review of the shipping markets.
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While various alliances have already unveiled moves to adjust supply to meet demand, more needs to be done due to the fact that the newbuildings that enter service continue to increase the supply of tonnage, Pedersen pointed out.