Shipping rates to Europe to increase

NST Logistics 02 July 2007

Shipping rates for exports from Asia to Europe is set to move up again as the cartel of 16 shipping lines under the Far Eastern Freight Conference (FEFC) confirmed that they will be increasing rates to and from Asia as of 1st July, 2007.
  
The rate increase follows strong growth in exports from Asia to Europe.
 
The Far Eastern Freight Conference, whose member lines control more than two-thirds of the available Asia/Europe vessel capacity, has reported impressive volume growth in both directions of the trade during the first quarter.
 
In the dominant westbound leg, volumes rose 20.7 per cent to 2.12 million TEUs, with the Far East to North Europe up 19 percent to 1.4 million TEUs and Asia to Mediterranean rising 24.2 per cent to 724,890 TEUs.
 
In the Eastbound trade from Europe to Asia, the FEFC reported a 9.6 per cent overall rise to 815,173 TEUs.
 
On a regional basis, volume from North Europe to Asia improved 7 per cent to 661,569 TEUs with Mediterranean to Asia cargoes increasing 22.2 per cent to 153,604 TEUs.
 
Meanwhile, the increases posted may be among the last the conference lines are expected to enjoy before the Conference gets the axe following the European Commission's decision to end the exemption from competition rules for conference lines.
 
The proposal to repeal the competition exemption for the conferences was the result of a three-year in-depth investigation by the EC following extensive consultations with carriers, shippers and freight forwarders.
 
Carriers recognise now that price fixing is no longer necessary in today's market conditions.
 
After dismantling the conference structure, shipping lines are expected to form trade associations which will have nothing to do with rates with each individual member line will have a right to fix their own rates and prices will be driven by supply and demand.

BACK TO NEWS PAGE