Maersk "100 Percent Certain" About Doubling Freight Rates

by Ship & Bunker News Team
Wednesday May 22, 2013

A.P. Moller-Maersk (Maersk) says it is "100 percent certain" it can more than double freight rates in July, Reuters reports.

Chief Executive Nils S. Andersen said he had "no doubt" that Maersk Line, the company's container shipping unit, will be able to raise its rates from the current level of $731 per twenty foot equivalent unit (TEU) to $1481 per TEU starting July 1.

A 36 percent drop in spot rates since March has left most containers shippers operating at a loss.

"To be honest, we just have to get used to the fact that these are harder times, and that there will be harder times ahead," Andersen said.

Maersk is expecting the delivery of the first of its 20 new 18,000 TEU capacity Triple-E ships this summer, and some observers say the increase in market capacity will put further pressure on rates.

However Maersk Line chief executive Søren Skou said recently that deploying more capacity is "a really stupid, stupid strategy," and the company plans to introduce the Triple-E ships gradually while removing smaller ships to avoid flooding the market.

Maersk has said the new ships will help its bottom line because of their greater fuel efficiency per unit shipped.

The company said recently that it was able to improve its results in the first quarter of the year thanks partly to reduced bunker use through more fuel efficient operations.

Ship & Bunker News Team
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