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Maersk Line downbeat on Asia-Europe box volumes

Maersk Line downbeat on Asia-Europe box volumes
Singapore: Container shipping's Asia-Europe trade in the first half of 2013 will see volumes dip year-on-year while the transpacific route will record 2-3% growth, according to Thomas Riber Knudsen, chief executive, Asia Pacific Region, Maersk Line.

The bleak outlook for the two leading trades of container shipping is largely due to the sector's vessel tonnage glut that resulted in an imbalance demand-supply situation, which is unlikely to improve over the course of this year, Knudsen commented.

“In Asia-Europe, we don't see a positive outlook in the first six months of this year and we expect that the market will be negative compared to a year ago in terms of volumes,” he told Seatrade Global Online.

In the transpacific trade, which relies mainly on consumer demand from the US, Maersk Line is predicting a limited growth of 2-3%. “We are a little more positive on North America as the housing market has improved and we expect consumers to start spending more money,” he said.

Globally, excess shipping tonnage and flat demand in the market have restricted freight rates from moving up to profitable levels for shipowners on a sustainable basis. The situation is made worse by soaring bunker fuel prices wiping out whatever marginal profit that was generated.

“Clearly it is going to be another difficult year with volume growth at 3-5% on a global basis,” Knudsen said, adding that the second half of the year might witness stronger growth. “We will probably see an improvement in 2014 but the jury is still out as a lot depends on how much capacity will enter the market.”

Maersk Line, the world's biggest container carrier, will take delivery of four to five ultra-large containerships of 18,000 teu in capacity each within this year. The Danish shipping conglomerate has ordered 10 of those giant ships, known as Triple E, for delivery between 2013 to 2015.

Knudsen said the mega-ships taken this year will enter Maersk Line's Asia-Europe strings to minimise any impact on the company's fleet deployment. “What we want to do is to manage our capacity to ensure we don't push excess capacity into the market,” he affirmed.