How will Hanjin’s Collapse Affect Ocean Freight Rates?
Hanjin’s big bump in the road has made for some interesting reading and writing for bloggers and press. As a company focused on the ups and downs of ocean freight rates, we can only but speculate what effect Hanjin’s drama can have on prices. So, naturally we went to our community to check the overall feeling on the topic.
We asked the social media community their thoughts on how Hanjin’s collapse will affect ocean shipping rates. Fifty percent of the respondents indicated that rates would indeed go up while 36 percent did not expect any change. A small percentage, seven percent, expects a decline while another seven percent of respondents were not sure.
As the news of Hanjin’s collapse sunk in, spot rates settled down the following week barely inching upwards for Asia to U.S. West Coast and East Coast ports. This may indicate that U.S. importers are finding space on other carriers during the peak season. Indeed, Maersk announced that it would open a new service from Asia to the U.S. west coast to soak up Hanjin’s customers. Similarly, MSC announced the introduction of a new transpacific service called Maple that started September 15.
According to Maersk, it is seeing a short-term rise in freight rates and new clients after the collapse of Hanjin Shipping Co. “The question is what will happen with the rates in the longer term. In the short term, the effect is positive, but there are many factors that can influence rates in the medium and in the long term,” a company representative said.
Indeed, the Chinese New Year holiday is January 28, so not only could vessel space tighten more in the next month or so but rates could likely increase even more as retailers look to book space before Asian factories close during the Chinese New Year festivities.
Katherine Barrios is chief marketing officer at Xeneta, a company which provides a database of ocean freight rates.