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July 20 2020

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22 The Journal of Commerce | July 20 2020 www.joc.com International Maritime CARRIERS ANNOUNCED ANOTHER nine blank sailings on the trans-Atlantic at the beginning of July, extending their capacity withdrawals deeper into the third quarter ahead of a worsening economic outlook for countries on both sides of the Atlantic. The blank sailings bring the number of sailings canceled on the trans-Atlantic in the third quarter to 23, withdrawing 10 to 25 percent of capacity — depending on the individual week — through week 33 (Aug. 10) on the North Europe and Mediterranean to North America East Coast (NAEC) trades, according to Sea-Intelligence Maritime Analysis. From January through May, total volume on Europe–North America routes fell 6.8 percent to 925,220 TEU compared with the same period in 2019, according to GTA Forecasting, a sister com- pany of The Journal of Commerce within IHS Markit. It is the first time in five years that volume on the trans- Atlantic has registered a year-over-year decline during this five-month period, ending a period of stable growth in trade between two mature economic regions. GTA Forecasting expects US imports from Europe to fall 17.2 percent to 2.65 million TEU in 2020 and has forecast that US exports to Europe will likewise drop 17.4 percent to 1.68 million TEU. "A sharp increase in blank sailings on the North Atlantic is an indication that there is no structural improve- ment in the US economy," Alan Murphy, CEO of Sea- Intelligence Maritime Analysis, noted in the firm's Sunday Spotlight newsletter. The International Monetary Fund (IMF) recently revised down- ward its World Economic Outlook, which already predicted a steep decline in EU and US economic growth when released in April. The IMF now expects Europe's economy to contract by 10.2 percent in 2020, compared with the 7.5 percent decline forecast in April, and US gross domestic product to fall 8 percent, down from 6 percent. This is a grim scenario for con- tainer shipping, which counts on consumer demand to keep its ships full, and the impact of weakening volume is already being felt. COVID- 19 lockdowns in Europe and the US that closed all non-essential retailers and factories for two months had the Cuts like a knife Container lines extend trans-Atlantic blank sailings By Greg Knowler With COVID-19 sapping consumer demand, US imports from Europe are projected to drop 17.2 percent in 2020. Shutterstock.com

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