Weekly Supply Chain Update: 15

Maersk Announces Blank Sailings Ahead of China's Golden Week

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Maersk has announced plans for several blank sailings ahead of China's upcoming Golden Week National holiday. The company stated that this decision is intended to align its network with the anticipated drop in demand and the reduced workforce available to manage cargo operations during this period.

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Peak Season Shipments Face Tightening Window Due to Extended Transit Times and Golden Week, While Rates Drop Across Key Trade Routes

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The arrival window for peak season shipments from China to North Europe and the Mediterranean is tightening due to extended transit times via Africa and the upcoming Golden Week in China, which is easing the pressure on rates. Rates to North Europe have dropped by 10%, while Mediterranean rates are down by 19% from their July peaks. On the transpacific route, concerns over a potential port worker strike on October 1st are pushing volumes to the West Coast, leading to a slight rate rebound, though prices remain 15% lower than mid-July peaks. Increased competition and capacity have further contributed to falling rates. Despite this, demand on the West Coast remains strong, with extra sailings scheduled. Additionally, flooding in India has created backlogs at the Port of Mundra.

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COSCO SHIPPING Signs $2 Billion Deal for 42 Energy-Efficient Bulk Carriers, Marking Largest Shipbuilding Agreement Since 2016

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On 30 August, COSCO SHIPPING Development signed a landmark agreement to invest in, build, and lease 42 bulk carriers, marking the company’s largest shipbuilding and leasing deal since transitioning to a shipping and finance operator in 2016. The construction will be divided between COSCO Shipping Heavy Industry, which will build 20 vessels, and CSSC Chengxi Shipyard, a COSCO subsidiary, responsible for 22 ships. The order includes five 64,000-ton, two 82,000-ton, and 35 80,000-ton bulk carriers, with a combined value exceeding $2 billion. The energy-efficient and environmentally friendly vessels, some of which will be methanol-ready, are scheduled for delivery between 2026 and 2027 and will be leased to COSCO SHIPPING Bulk for long-term use

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Red Sea Attacks Drive 66% Drop in Suez Canal Traffic as Ships Reroute Around Africa

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The number of vessels navigating the Suez Canal has fallen by 66% since shipping companies began rerouting their ships around Africa, according to recent data from AP Møller-Maersk. This change is largely due to increased attacks in the Red Sea, impacting global shipping and supply chains. As a result, there has been a significant shift in cargo volumes and adjustments in shipping services, placing added strain on port infrastructure, leading to congestion, delays, and shortages in capacity and equipment. Since November, Iranian-backed Houthi rebels have targeted vessels in the Red Sea, aligning with Hamas in its conflict with Israel. These safety concerns have driven shipping companies to avoid the Suez Canal, opting instead for the longer route around the Cape of Good Hope at the southern tip of Africa. According to Maersk, the disruptions in the Red Sea have had a global impact on cargo shipments.