July News & Updates
Upcoming Rate Increases

After rock bottom rates in 2016, rate levels are maintaining their recovery through 2017.

Container shipping is fast becoming a carriers’ market and with the extra pricing power gained by industry consolidation, alliances and better supply-demand fundamentals, the stage is set for continued rate recovery.

Maritime analyst Drewry said headhaul trades that were most important to carrier revenues were staging a broad recovery from the rock-bottom rate levels of last year and that this was likely to continue for the balance of 2017.

Carriers have been able to secure higher trans-Pacific service contracts for the 2017–18 season, with prices around $1,200 per FEU to the West Coast, compared with about $800 to $900 per FEU in the prior season.

“Due to the higher 2016 second-half rates the comparisons will get tougher as the year goes on, which will put an end to the very high year-over-year increases, but even if they plateau or start decreasing in the fourth-quarter 2017 they will still be higher than in 2016 as a whole,” Drewry said in its Container Insight Weekly.

“This year is one of huge correction after a disastrous 2016 for rates, buoyed at the same time by better supply and demand fundamentals,” the analyst said. “While there is still some ground to be made up to get above pre-2015 levels there is no doubt that the pendulum is swinging quite fast towards a carriers’ market.”

Cosco placing an offer on OOCL

Cosco container lines and Shanghai International Port Group have placed an offer for $6.3 billion to purchase OOCL. This offer does require approval approval from regulatory committees are well as Cosco shareholders before moving forward. 

While Cosco claims they will operate OOCL separately, this buyout would push Cosco/OOCL to the 3rd larges mega ship fleet in the industry and 2nd largest carrier for US containerized goods operating at total of 400 ships with 2.9 million TEU capacity. 

Shippers are concerned as consolidation continues in the Industry, rates will continue to climb as we are seeing now with the HL/UASC merger. 

Read the full article from OOIL's website here.

Maersk Cyber Attack

Maersk is slowly but surely recovering from the cyber attached from the end of June. Most systems are now back online and terminals are operating. However, many of their processes are still manual which is causing slower truck turn times at the terminals and delays on booking and rate requests. 

As of Sunday, Maersk has advised they have been "successful in bringing many of this systems back online. With these systems comes an immense amount of data that will need to be reconciled manually from logs created during the last week into our systems. We continue to make great progress on getting most of our main Customer Service phones up and running. We're diligently working through your email inquirers. Finally, we have been able to have tracking data up to 8th of July available on online."

Equipment issues trickling to US inland points

Exporters across the countries are starting to experience equipment shortages at inland ramp locations across the US. The shortage is due to some seasonal fluctuations of equipment as well as a change in Chinese regulations on the production of containers and a strong push on carries to transport equipment back to Asia for import cargo. 

The top rail ramps experiencing equipment shortages are Kansas City, Chicago, Dallas, Denver, and Memphis. We have also seen equipment shortages with certain carriers in Louisville, Columbus and Nashville areas. We are continually working with truckers to check which carriers have the best equipment levels to ensure your bookings are covered. 

Employee Spotlight
Ariel Watson- Export Account Executive Mobile, AL

Ariel has been working with ASF’s export department for 6 years. She studied international business at the University of South Alabama and says working for ASF as been an amazing experience for her as she continues learning more about exports and imports. Everyday is never the same and provides an array of different challenges that allows for consistent growth and knowledge.  In her spare time, Ariel is a huge foodie and loves to travel with friends and family. She is always up for trying new things and gaining new experiences. 

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