French Carrier CMA CGM will add container capacity and additional port calls in the Asia-to-Europe trade lane after demand for containerized trade grew dramatically in the final months of the year, the company said in a notice to clients Dec. 14.
The company has boosted operational capacity on the Asia to Europe trade by 6% in the fourth quarter of 2020 compared with the same period last year. This includes the deployment of three new 23,000 Twenty-foot Equivalent Unit (TEU) LNG-powered ships, in addition to extra loader ships.
And CMA CGM will continue to bolster its container availability in 2021. "Capacity will be 10% higher than in the current quarter," the company said Dec. 14.
The rate spike comes on the back of a spike in consumer demand throughout Europe, and retailer stockpiling in anticipation of the UK's departure from the EU, compounded by equipment shortages across major exporting ports in Asia.
Severe terminal congestion at major UK container gateways have also contributed to surging freight rates.
"No one wants UK business out of Asia right now, so you're going to have to pay for it," said a freight forwarder. "On the upper end of the rates are CMA-CGM charging 9,500/FEU for Sea priority."
Much of these charges are premiums and surcharges added on top of the standard freight rate. Platts Container Rate 1 -- North Asia to UK Continent -- was assessed Dec. 14 at $5,000/FEU on an FAK basis, which excludes port congestion charges and other premiums. This number represents a 92.3% increase from the Nov.. 30 assessment of $2,600/FEU on the same route.
