As forwarders start to look towards the end of the peak season on the Asia-Europe trades, a new source of frustration is emerging on the India/Middle East-Europe route, where booming westbound demand is coinciding with capacity constraints.
“We are seeing a large increase in demand on ISC trade, getting shipments away is nigh-on impossible, and we are now having to book four-to-six weeks in advance,” one European freight forwarder told The Loadstar.
“Shipping lines cannot support our allocation agreements – the ships are full – and we have seen carriers cancel bookings rather than roll [cargo], so you have to go through the whole booking process again,” she added.
CMA CGM has been quick to take advantage of the supply-demand imbalance, issuing a peak season surcharge (PSS) on India-North Europe and India-Mediterranean shipments of $500 per container for 15 July.
This was followed by a further announcement, that the PSS would be increased to $1,500 per container on 22 July.
“I was told CMA CGM is full and experiencing elevated demand,” the forwarder confirmed.
However, the problem appears to be across the trade, with a number of carriers instituting a series of blanked sailings and port omissions, with poor schedule reliability also playing a part.
According to a Loadstar analysis of Xeneta’s eeSea liner database, there were 248 liner services due to sail between 1 March and today (8 July) between India and Europe (both North Europe and the Mediterranean), based on pro forma schedules.
However, 51 of these did not take place – 43 were blanked and the remaining eight cancelled due to “delays and other events”. This meant the trade’s pro forma capacity during that period was reduced from 1.59m teu to 1.32m teu.
At the same time, the latest Container Trade Statistics data, up to the end of April, shows a strong rebound in demand in March and April.
Source: Container Trades Statistics
CMA CGM’s EPIC service, operated in cooperation with Cosco and OOCL, saw 13 sailings depart India during that period, compared with a scheduled 18, the other five blanked, which meant its combined capacity offered to shippers was 116,000 teu against a pro forma 165,000 teu.
MSC’s IPAK service saw three sailings blanked across May and June, and one skipped, while also omitting a series of North European calls: MSC Pegaus VII omitted London Gateway on 25 May; MSC Elaine omitted Rotterdam on 15 June, and then Bremerhaven on 22 June; and MSC Melissa omitted Hamburg on 27 June.
“So now these continental European volumes were on the IPAK service, which called at the UK – that is capacity reduction,” the forwarder added.
Meanwhile, ONE’s IOX service, operated in conjunction with Premier Alliance partners HMM (INX) and Yang Ming (ISE), has been littered with blanked sailings in recent months – between 1 March and 8 July, it operated 11 voyages out of a pro forma 19, with capacity reduced from 103,000 teu to 62,000 teu.
“The service is not really happening weekly, more like every 10 days. This has another impact on capacity – if you are rolled, the delay is longer, and advance bookings on the next available vessels is a long wait,” the forwarder said.
The eeSea database noted that six of the sailings in the period had been blanked and two cancelled for other reasons.
Meanwhile, the latest Sea-Intelligence Consulting schedule reliability report, which covers the April/May period, recorded just 27.3% of the vessels on the IOX service arrived on time. This compared with 45.2% on CMA CGM’s EPIC services and 88.2% on MSC’s IPAK.
MSC’s performance was only bettered by two Gemini services – the India-Europe loop and the India-Northern Europe loop – which hit 90.9% and 92.3% respectively.
On both Gemini strings, capacity exceeded pro forma, both operating 19 sailings versus a pro forma 18, via the introduction of extra loaders, which added 10,000 teu capacity to the trade.
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