Sea freight rates between Asia and Europe on the rise

Mon 18 May 2020
Posted by: Sam Pileggi
Trade News

cargo ship

The cost of transporting cargo by sea continues to rise as demand slows, The Loadstar reports today.

France’s CMA CGM, the world’s fourth largest container line, has unveiled a $300 increase in FAK (Freight of All Kinds) rates per 40 ft for journeys from Asia to Europe, to $2,000 from 1 June.

The Loadstar understands that AP Moller-Maersk, the world’s biggest container shipping line, was among those carriers that had increased their short-term rates for the second half of May. 

Maersk’s 40 ft price for its Shanghai to Felixstowe route had risen from $1,220 to $1,350 in recent days, The Loadstar reported. 

Maersk bellwether 

Meanwhile in an interview with the Financial Times last week, the chief of Maersk said his firm was taking things “one quarter at a time”, adjusting capacity when demand weakened.

Chief executive Soren Skou predicted a 20-25% fall in shipping trade in the 2nd quarter (1 April-30 June) of 2020 as COVID-19 continues to disrupt global economics. 

Described by the FT as a “bellwether for global trade”, Maersk was unveiling its first quarter 2020 results, with pre-tax earnings rising 23% on the previous year to $1.5bn.

He expects international trading firms to review their supply chains as a result of COVID-19. This would involve adding suppliers to their roster rather than replacing any, he said.