Shipping lines reduce services

Low utilisation rates have forced shipping lines to reduce capacity on the Asia to Europe routes in an effort to cut costs.  Freight rates have been steadily declining on the route, and shipping lines are hoping to push up rates by reducing capacity and increasing demand.  According to the latest Shanghai Containerised Freight Index, container rates fell last week by $11 per tonne on the previous week.

Independent freight forwarders are criticising the larger companies for offering rates which destroy profit margins for the trade as  a whole. An industry commentator said that many participants in the China market do not expect rates to rise in the near future, as carriers are competing to slash rates.