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Container lines hit with $300m - $350m weekly revenue loss from coronavirus

Container lines are taking an estimated revenue hit of $300m - $350m as they blank sailings due to the impact coronavirus in China according to analysts Sea-Intelligence.

Marcus Hand, Editor

February 10, 2020

1 Min Read
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In its weekly newsletter SeaIntel highlighted that with the extended closure of Chinese factories extremely low levels of exports were forcing the mass cancellation of sailings.

According to the analyst in a “very short period of time” lines had blanked an additional 31 sailings on the transpacific and Asia – Europe trades due to the coronavirus, on top of existing cancelled voyages over the lull of Chinese New Year.

On the transpacific some 21 sailings had been blanked equating to 198,500 teu of capacity, these came in addition to 61 voyages cancelled over Chinese New Year.

On the Asia – Europe trade, where larger vessels are deployed, 10 additional sailings were blanked taking out some 151,000 teu of capacity. Lines had already blanked 51 sailings over the holiday period on the Asia – North Europe/Med trade.

In real terms for container lines this will equate to a substantial hit on revenues. “In very round numbers, we are experiencing a shortfall of some 300,000 - 350,000 teu per week in the market. Again, in very round numbers, if this is at average rate levels of around $1,000 per teu it equals a revenue shortfall for the carriers of $300-350m per week,” SeaIntel said.

For shippers using backhaul trades the result could be the shortage of capacity in the weeks to come and also therefore increased rates.

Related:Chinese port volumes hold up in January despite coronavirus impact

“The rapid mass-cancellation of additional sailings have a high likelihood of causing capacity shortages for back-haul shippers 3-6 weeks into the future, depending on geography. Back-haul shippers should therefore now prepare not only contingency plans for potential capacity issues, but also for significant price spikes,” the report said.

Read all Seatrade Maritime News coverage on the impact of the coronavirus on shipping

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About the Author

Marcus Hand

Editor

Marcus Hand is the editor of Seatrade Maritime News and a dedicated maritime journalist with over two decades of experience covering the shipping industry in Asia.

Marcus is also an experienced industry commentator and has chaired many conferences and round tables. Before joining Seatrade at the beginning of 2010, Marcus worked for the shipping industry journal Lloyd's List for a decade and before that the Singapore Business Times covering shipping and aviation.

In November 2022, Marcus was announced as a member of the Board of Advisors to the Singapore Journal of Maritime Talent and Technology (SJMTT) to help bring together thought leadership around the key areas of talent and technology.

Marcus is the founder of the Seatrade Maritime Podcast that delivers commentary, opinions and conversations on shipping's most important topics.

Conferences & Webinars

Marcus Hand regularly moderates at international maritime events. Below you’ll find a list of selected past conferences and webinars.

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