Larger new container vessels entering US east and west coast container trades could foil attempts by liner operators to raise transportation rates in 2015, according to a container sector analyst.
The capacity surge is coming at the same time that the National Retail Federation (NRF), a major US container shipper group, is predicting volume increases of 4 to 8% through August, during much of the peak shipping season.
The strong volume forecast has prompted the Transpacific Stabilization Agreement, a 15-member alliance of box carriers, to seek USD1,600 in rate and surcharge increases by 1 July.
However, “There is not enough demand to justify this level of capacity increase,” said Ben Hackett, founder of Hackett Associates, in the latest monthly Port Tracker released on 8 May.
Hackett said the change in the supply-demand balance could lead to a “price war” on transportation rates. “Expect rates on both coastal services to fall to all-time lows.”
NRF noted that US import container volume levels are returning to normal since West Coast dockworkers agreed to a tentative labour pact in February. A ratification vote count on the agreement is scheduled for 22 May.
NRF and Hackett Associates predict US box imports for the first half of 2015 will hit 8.8 million teu, a 6% y/y increase.
This post was sourced from IHS Maritime 360: View the original article here.
