BRi USA NEWS - Australia Trade - Shipping Line Space and Pricing Strategy July 2020 through 2021



With this article are the following attachments

Dear all Valued Customers


Reference:                 Australian Trade


An important update relating to what we believe will take place as we continue through COVID and into end of year, early 2021


This update outlines what we believe to be the shipping line space and pricing strategy – taking into account what we have seen January through July and via the shipping line’s rhetoric!


Based on current climate conditions low cargo demand has prompted all Major Shipping lines (Asia to Australia) to return all new chartered tonnage (Vessels)


The shipping lines clear objective seems to be that of reducing fleet capacity so as to place immediate pressure on space availability!


In the first half of 2020 we have seen eleven of the twelve largest shipping lines reduce their overall fleet capacity! (Remove all large vessels from the trade)


The shipping lines have reacted to the lower cargo demand (COVID-19 pandemic) by redelivering chartered tonnage to their owners – Returning the larger vessels back to the actual builders/owners


The biggest capacity adjustments have been made by Maersk and MSC ( remembering they are 1 and 2 largest carriers in the world -reducing the trade lane fleet by some 236,000 TEU slots)


This equates to a 23% total reduction in space availability for the Australian trade effective July 2020.


This is the most significant move made by any shipping line in the last 50 years!


In addition to the above both Wan Hai and PIL Shipping have made the largest fleet cuts based on percentage! A move that equates to 13% on its own


It is clear now that container space availability will only get worse in Q3 through Q4 and as we speak (as per attached) Hamburg Sud Shipping (who is owned by Maersk Shipping Line) has suspended the AUS Southern Loop service until end of 2020. This equates to an additional loss of 4 container vessels (10,000TEU)!


As we move through August we can see that the Shipping Lines are taking advantage of the space restraints with a clear intention to increase container rates starting September (refer attachment)


Like everyone else in the market, concerns continue to be raised that shipping lines will continue to restrict space & impose further rate increases through end of 2020 extending through to Chinese New Year (February 2021).


BRi is committed to working with all our valued clients through this period & are we continue to actively engage all shipping lines so to get the best outcomes that support your business through this extremely challenging period.


As a valued customer, we hope that you will continue to trust us to source the best options for your supply chain needs now and into the future. Please feel free to contact your Customer Solutions Representative, should you have any questions regarding the USA News.


Keeping you updated,

BRi Customer Solutions Team

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