Transatlantic party over as rates plunge

Celebrations are over for liner operators that transferred ships to the Transatlantic lane after Asia-Europe and Transpacific rates began tanking, according to Alphaliner's report today (2 August).

Ellerman City Liners, a shipping line started by UK freight forwarder Uniserve, started transferring its chartered ships from the Asia-Europe trade to a new Europe-US East Coast loop in December 2022. At the time, Transatlantic rates stood around US$6,000/FEU, compared to only US$2,100/FEU for shipments from Shanghai to North Europe.

However, now, Transatlantic rates have fallen to just US$1,600/FEU as more capacity is available.

There are now 198 cellular container ships trading in regular liner services between Europe and the East and West coasts of Canada, the United States and Mexico, representing a capacity of 1.13 million TEUs, up 6.6% year-on-year. This fleet is evenly spread between services linking North Europe with North America (49.8%) and Transatlantic loops to/from the West and East Mediterranean (50.2%).

Other carriers that contributed to the Transatlantic capacity growth are CMA CGM (up 34% year-on-year) and COSCO Shipping Lines (up 38%). The latter replaced 8,060-8,500 TEU vessels with 13,100 TEU units. CMA CGM’s expansion is partly related to the launch of a Mediterranean-US Gulf service in October 2022.

MSC remains the biggest Transatlantic carrier with a fleet of 430,200 TEUs, of which 61.1% is operated outside its 2M alliance with Maersk. MSC was the first to start extra Europe - US East Coast standalone loops when the Transatlantic trade was booming and is also very active to/from Canada and the US West Coast, which falls outside the scope of the traditional alliances.

The Swiss/Italian carrier was the first to reduce in the Transatlantic capacity, with 4% removed by closing one service and two Transatlantic loops, but its market share stands at around 38%. Maersk also removed 5% of Transatlantic capacity, after withdrawing one ship for a 2M North Europe - US Gulf loop. The Danish company remains the number two carrier worldwide, but takes the third spot among the 10 largest Transatlantic operators.

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