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Is The Ocean Freight Market A Buyer's
Or Seller's Market?
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2016 has been a year of
turmoil and upheaval within
the ocean freight market –
the formation of new
alliances, mergers and
acquisitions and a
bankruptcy of a major ocean
liner.
With these changes in mind, we asked
the opinion of some industry players if
the ocean freight market is becoming a
seller's or buyer's market. Nothing was
conclusive, but it for sure made for
some interesting discussions.
A Buyer's Market With
Uncertainty
Although the market is in recovery with
spot market rates trending upwards, it
seems the industry as a whole is not yet
convinced that carriers are in for a
long-term win. A good number of our
conversations revolved around the opinion
that the market is still a buyer's market
and carriers can't yet call victory.
The overall the market has been trending up for a few months.
With november's gris holding steady in Asia-Europe spot market
and an increase reported last week, at the moment, we can't deny
that carriers are doing a bit better than in q2, for example.
What may be more surprising or perhaps not surprising at all is
the fact that most folks we spoke to indicated they were not sure.
2016 has been an unprecedented year for the ocean freight
market.
More Big Boys Taking Sail In
2017
We shouldn't forget
that next year we will
see some large
shippers taking sail
which is anticipated
to add more capacity.
Maersk has 11 new
triple e's (Asia
-Europe) coming into
play from april 2017
part of their organic
growth strategy.
The acquisitions and bankruptices this year haven't done too
much to address the oversupply issue.
[He is concerned] about how long the
momentum would be maintained given the
fundamental oversupply of space, which is
expected to be exacerbated by new
ultra-large container vessel (ULCV) deliveries
next year. All the mergers and acquisitions
this year, and even the Hanjin bankruptcy,
haven’t done anything to address the
oversupply side of the industry
- Patrik Berglund (CEO)
Alliances, M&AS And
Bankruptcies Oh My
Earlier this year, the
number of alliances was
reduced to three – the
alliance, 2m and the
ocean alliance. Combined,
these alliances will have a
commanding share of
major trade lanes.
or example, for the largest
lane, Asia-Europe, the
three alliances combined,
is estimated to have a
99% share of the capacity.
The uncertainty of what this may bring to shippers in april 2017
when the alliances goes into effect is apparent in the large
percentage of respondents that noted they were not sure what
kind of market ocean freight is moving towards.
In addition, with maersk acquiring Hamburg süd, there are now 11
global carriers, down from 20 at the start of the decade.
According to online publication, splash 24/7, Israel’s Zim, is
looking to reduce its global presence and focus more on regional
transport while Yang ming and oocl are denying they are looking
at sale opportunities. Splash 24/7 speculates that for the right
price senior management at both lines would sell or possibly
merge together.
Learn How Xeneta Can Help
You Get Insight And Intelligence Into
Your Global Ocean Freight Prices And
Change Your Logistics Business:
Request
Demo Now

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Is the Ocean Freight Market a Buyer's or Seller's Market?

  • 1. Is The Ocean Freight Market A Buyer's Or Seller's Market?
  • 2. Join The Conversation On Twitter @XENETA_AS
  • 3. About Xeneta Container Freight Pricing Transparency With One Platform In Real Time & On Demand.
  • 4. Are You Paying The Right Container Freight Rates? Discover Savings Potential In Real Time. Contact Us.
  • 5. 2016 has been a year of turmoil and upheaval within the ocean freight market – the formation of new alliances, mergers and acquisitions and a bankruptcy of a major ocean liner.
  • 6. With these changes in mind, we asked the opinion of some industry players if the ocean freight market is becoming a seller's or buyer's market. Nothing was conclusive, but it for sure made for some interesting discussions.
  • 7. A Buyer's Market With Uncertainty
  • 8. Although the market is in recovery with spot market rates trending upwards, it seems the industry as a whole is not yet convinced that carriers are in for a long-term win. A good number of our conversations revolved around the opinion that the market is still a buyer's market and carriers can't yet call victory.
  • 9. The overall the market has been trending up for a few months. With november's gris holding steady in Asia-Europe spot market and an increase reported last week, at the moment, we can't deny that carriers are doing a bit better than in q2, for example. What may be more surprising or perhaps not surprising at all is the fact that most folks we spoke to indicated they were not sure. 2016 has been an unprecedented year for the ocean freight market.
  • 10. More Big Boys Taking Sail In 2017
  • 11. We shouldn't forget that next year we will see some large shippers taking sail which is anticipated to add more capacity. Maersk has 11 new triple e's (Asia -Europe) coming into play from april 2017 part of their organic growth strategy.
  • 12. The acquisitions and bankruptices this year haven't done too much to address the oversupply issue.
  • 13. [He is concerned] about how long the momentum would be maintained given the fundamental oversupply of space, which is expected to be exacerbated by new ultra-large container vessel (ULCV) deliveries next year. All the mergers and acquisitions this year, and even the Hanjin bankruptcy, haven’t done anything to address the oversupply side of the industry - Patrik Berglund (CEO)
  • 15. Earlier this year, the number of alliances was reduced to three – the alliance, 2m and the ocean alliance. Combined, these alliances will have a commanding share of major trade lanes. or example, for the largest lane, Asia-Europe, the three alliances combined, is estimated to have a 99% share of the capacity.
  • 16. The uncertainty of what this may bring to shippers in april 2017 when the alliances goes into effect is apparent in the large percentage of respondents that noted they were not sure what kind of market ocean freight is moving towards. In addition, with maersk acquiring Hamburg süd, there are now 11 global carriers, down from 20 at the start of the decade. According to online publication, splash 24/7, Israel’s Zim, is looking to reduce its global presence and focus more on regional transport while Yang ming and oocl are denying they are looking at sale opportunities. Splash 24/7 speculates that for the right price senior management at both lines would sell or possibly merge together.
  • 17. Learn How Xeneta Can Help You Get Insight And Intelligence Into Your Global Ocean Freight Prices And Change Your Logistics Business: Request Demo Now