Digital Edition

January 6 2020

Issue link: https://jocdigital.uberflip.com/i/1195341

Contents of this Issue

Navigation

Page 27 of 147

26 The Journal of Commerce | Januar y 6 2020 www.joc.com Maritime 2020 ANNUAL REVIEW & OUTLOOK 2015, according to Sea-Intelligence. "When the market collapsed in 2016, this caused the rates to drop to $2,000 per FEU. Since then the roundtrip rate level has gradually been increasing," Murphy said. But rates on the eastbound US-Europe route already are being affected by a capacity injection on the trade. Sea-Intelligence estimated capacity on the North Europe-US East Coast trade would increase 10.3 percent in the fourth quarter year over year, while capacity on the Mediterranean-US East Coast would grow 9.8 percent. solid in 2019, and indeed has been since a slowdown in 2016. According to data from PIERS, a sister company of The Journal of Com- merce within IHS Markit, the total laden volume on the US-Europe trade was up 5.5 percent from January through August to 2.66 million TEU. US imports grew 5.1 percent year over year during the period, while exports jumped 6.1 percent. The trade growth comes on top of a 3 percent increase for the full year in 2018 and a 5.7 percent increase in volume in 2017. "The trans-Atlantic trade is clearly strengthening and has been for quite a while, regaining more than 70 percent of the rate that was lost when the market collapsed in 2016," said Alan Murphy, CEO of maritime analyst Sea-Intelligence Consulting. The round-trip rate for the trans- Atlantic trade, as measured between Rotterdam and New York, declined from a high point in 2012 before settling at a stable level of $3,000 per FEU from spring 2013 to spring Trading blows Escalating tariffs threaten to undermine trans-Atlantic trade By Greg Knowler "US shippers exporting to Europe need to be prepared for EU counter- tariffs on US goods." The trans-Atlantic has been the most stable of the east– west container shipping trades since 2016, but tariffs could soon change that. Shutterstock.com SOLID GROWTH IN trade between the US and Europe over the past three years is being threatened by the Trump administration tariffs that continue to hang over relations between the two trading blocs in a dispute that shows no sign of being resolved any time soon. The trans-Atlantic has been the most stable of the major east-west container shipping trades since 2016, with strong growth achieved in both headhaul and backhaul volume, but a recent escalation of trade tensions is clouding the 2020 outlook. During a state visit by President Donald Trump to Europe in early December, the office of the US Trade Representative said it was looking into increasing existing US tariffs on the European Union over subsidies paid to planemaker Airbus. A 10 per- cent tariff on new aircraft and a 25 percent tariff on certain Euro- pean goods, including denim, motor- cycles and some alcohol, took effect Oct. 18 on US imports. At the same time, the US threat- ened to impose 100 percent tariffs on $2.4 billion of French goods, such as champagne and imported bags and other luxury items, over a digital services tax in France that will affect US tech companies. Both messages received a furious EU response, with Brussels immedi- ately threatening retaliatory tariffs and pledging to stand behind France in its dispute with the US. Steady seas While the political battle rages in the background, down at sea level the container shipping business was

Articles in this issue

Links on this page

Archives of this issue

view archives of Digital Edition - January 6 2020