SIMIC

GENERAL rate increases (GRI), of US$600 per FEU have been implemented from April 15 by Mediterranean Shipping Co (MSC), CMA CGM and HMM to counter sagging spot rates, say customer advisories.
For the inland rail movement, both MSC and CMA CGM are charging an additional $200 on top of the GRI. Smaller carriers Wan Hai Lines Ltd and Zim have filed notice of a $1,000 and $1,200 GRI effective the same date.
Utilisation rates on the Asia to US west coast routing have increased more than 85 per cent, outpacing a similar spike seen ahead of the April 15 GRI two years ago, but still tracking below the high 80s in the same period in 2022, according to maritime analyst Linerlytica.
The utilisation spike ahead of the April 15 GRI dropped in the following weeks of 2022 and 2021. The extent of the likely drop this year will provide a hint to how well carriers have been able to recalibrate oversupply to weakening Asia import demand, which was down 31.1 per cent in February year on year, according to PIERS data.
As service contracting power has shifted from the carrier to shippers, many importers have held off on signing transpacific service contracts, hoping to leverage the sagging spot rate market and learn at which rate ranges the largest US big box retailers signed.
Carriers and shippers traditionally try to complete service contracts by the end of April since the lifecycle for most deals begins May 1.