South Korea’s Ministry of Oceans and Fisheries announced on 30 December that it has asked local liner operators to deploy more ships to North Europe and East Asia-Southeast Asia services.
The minister, Moon Seong-hyeok, said that the well-documented Transpacific capacity crunch is spreading to these in-demand routes, necessitating pre-emptive measures.
Capacity is so tight that on 31 December, South Korea’s largest mainline operator, HMM, is deploying a 1,400TEU multi-purpose vessel to carry containers from Busan to the US East Coast port of Savannah.
In response to the MOF’s request, HMM will launch an extra loader Asia-North Europe service in January 2021.
Rising Transpacific rates have caused a shortage of containers, as the lack of backhaul cargoes from North America has slowed the return of empty boxes to Asia, creating a ripple effect on other trade lanes. The Shanghai Containerized Freight Index showed that freight rates on the East Asia-Southeast Asia routes surged to US$910/TEU, compared with US$176/TEU in January, while spot rates to North Europe surged by US$2,000/FEU this month.
HMM and SM Line Corporation, are committed to deploying three extra loader services to carry cargoes from Busan to the US West Coast, and this practice will continue every month until further notice. This practice has also been implemented by Maersk Line, Mediterranean Shipping Company and CMA CGM.
Local intra-Asia carrier Korea Marine Transport Company will assign three extra ships to meet urgent demand to carry cargoes from Shekou and Huangpu in China to Malaysia’s Port Klang and Indonesia’s Tanjung Priok port.
Moon said, “It is natural to help each other when times are difficult, as shipping lines and exporters need each other. I see this as an opportunity for local exporters to have an economic structure that promotes win-win co-operation with national carriers.”
Martina Li
Asia Correspondent
