Evergreen Marine Corporation (EMC) chairman Chang Yen-yi has cautioned that if US East Coast port workers cannot resolve their differences with the US Maritime Alliance, it could cause more chaos in container shipping.
International Longshoremen Association (ILA) president Harold Daggett has warned that industrial action is becoming more likely as the current contract with the US Maritime Alliance expires on 30 September.
Chang said: “I predict that the ILA will demand higher salaries as the Red Sea crisis
has increased dockers’ workloads as shipping schedules are disrupted. If an agreement can’t be reached, the container shipping market will be more chaotic.
“It’s necessary to pay attention to the development in negotiations, as the recurrence of sabotage in the future will further affect the shipping market.”
In June, in a show of its optimism, EMC ordered six 2,400 TEU methanol, dual-fuelled ships from CSSC Huangpu Wenchong Shipbuilding for US$348 million, and commissioned 50,000 containers from Dong Fang International, China International Marine Containers (CIMC) and Singamas, at a cost of approximately US$162 million.
As to analysts’ predictions that freight rates may have peaked, Chang replied, “The current high freight rates are caused by the Red Sea crisis. I think that we will see changes at year-end, but how the situation changes, nobody can predict.
“From our standpoint, it is hoped that the current high freight rates can be maintained, but the market fluctuates. Freight rates are determined by supply and demand and are beyond liner operators’ control. Shipping lines can only strive to improve the turnover of vessels and containers.”
Concerns that an imminent ceasefire between Israel and Hamas have caused container futures indices in Shanghai to trend downwards, although Israel is continuing strikes in Palestine.
For June, EMC’s revenue went up 91% from a year ago, to TW$42.28 billion (US$1.3 billion). In 1H 2024, EMC’s revenue increased 45% year-on-year to TW$194.9 billion (US$5.99 billion).
Martina Li
Asia Correspondent
