New port fees applied by China and the US on each other’s vessels that took effect on 14 October have had less of an effect than expected, according to analysts at market intelligence group Linerlytica.
Chinese authorities have not applied the 25% US ownership rule strictly and only US-owned and operated Matson is affected by the fees so far, although Maersk and Hapag-Lloyd diverted two of their US-flagged ships on the transpacific TP7/WC5 service to avoid the port fees, Linerlytica said in a weekly update.
“At least one US-flagged operator has received waivers due to their newbuilding orders in China even though the waiver provision in the initial draft rules were omitted in the final Chinese version,” Linerlytica said. “The situation remains fluid with the final determination of the ownership threshold still to be announced.”
Linerlytica said that the disruptions were enough to drive freight rates on the Shanghai Containerized Freight Index (SCFI) up by 13% last week.
Analysts said there are insufficient cargo volumes to support a sustained rate push.
Lars Jensen, president of consultant Vespucci Maritime, said spot rates on the Pacific are now weaker than at the low point in the later parts of 2023, where the market was subdued due to overcapacity prior to the Red Sea crisis.
Looking back at Q4 2023, Asia-USWC bottomed out at $1,867/FEU (40-foot equivalent unit) and Asia-USEC bottomed out at $2,657/FEU.
Current rates as assessed by market players have Asia-USWC between $1,431/FEU and $2,195/FEU, while rates from Asia to the USEC range between $2,588/FEU and $3,236/FEU.
IMO DELAYS VOTE ON CARBON PRICING
International Maritime Organization (IMO) member states voted 57-49 to adjourn the Marine Environment Protection Committee (MEPC) for a year, delaying adoption of the Net-Zero Framework (NZF).
Linerlytica said the delay creates uncertainty around investments in new container ships, although it is unlikely to slow the ongoing surge of new ship orders.
The following chart from Linerlytica shows the orderbook breakdown by the top 18 carriers, with capacities in TEUs.
“Owners have added a further 240,000 TEU (20-foot equivalent units) to the orderbook in the last two weeks, bringing total new containership orders in 2025 past the 4 million TEU mark,” Linerlytica said. “Containership owners and operators are already ahead of other shipping segments in the adoption of green fuels, with 78% of the current orderbook capacity of 10.8 million TEU able to run on LNG (liquified natural gas) or methanol.”
However, the NZF postponement will favor transitional fuels like LNG over methanol with carriers such as MSC set to benefit as 94% of its current orderbook are LNG powered, Linerlytica said.
“The NZF delay will also favor carriers with older fleets which would also benefit MSC as its average fleet age at 17 years is higher than its peer average at 11 years,” Linerlytica said.
Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers, such as polyethylene (PE) and polypropylene (PP), which are shipped in pellets. Titanium dioxide (TiO2) is also shipped in containers.
They also transport liquid chemicals in isotanks.
Source: ICIS by Adam Yanelli
