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August 28 2023

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18 Journal of Commerce | August 28, 2023 Container Shipping Quarterly Special Report the Journal of Commerce Aug. 8. That "normalization" of volume has dragged rate levels down from the record highs of last year, but Asia– Mediterranean pricing continues to hold up far better than its northern counterpart, even with a seemingly successful Aug. 1 rate increase on the Asia–North Europe trade. Average spot rates from Asia to the Mediterranean rates of $2,426 per FEU on Aug. 10 were down 78.6% year over year, while short-term pricing for the longer Asia–North Europe routes of $1,695 per FEU was up almost 40% from July 31 but remained 82% below the same week last year, according to data from rate benchmarking platform Xeneta. "General rate increases have clearly had an impact, with China/East Asia to North Europe spot prices jumping 37% in one day on the back of new rate validities on Aug. 1," Peter Stallion, head of air and containers at Freight Investor Services, said in an early- August Baltic Exchange report. JOC email: Europe and the Mediterranean from Asia reached 12% in June, "which cer- tainly qualifies as a market rebound." Growth has been particularly robust in the Asia–East Mediter- ranean trade, with volumes rising 38% year over year in May and 38.5% in April. Shipments from Asia to the West Mediterranean rose 4% in May and 21.7% in April, CTS data shows. There is no clear data yet on what is driving the demand, but forwarders believe a resurgent holiday season in countries around the Mediterranean is stimulating retail sales, and imports of construction materials in Turkey have increased following a February earthquake on the country's border with Syria. Demand above 2019 levels While the Asia–Mediterranean volume comparisons are flattered by the weak demand last year, second- quarter volume on the trade lane has overtaken cargo carried by container lines in the same period of pre- pandemic 2019. From April through June, shippers in the West Mediterranean brought in 812,000 TEUs from Asia, almost 6% more than in the same three- month period in 2019, while Asia– East Mediterranean/Black Sea volume of 901,000 TEUs was up 7.1%. Asia– North Europe volume, on the other hand, fell 3.7% to 2.6 million TEUs in the second quarter. "After a weak start to the year, every month since March has shown a strong increase in volume into the Med," Nigel Pusey, CEO of CTS, told MEDITERRANEAN SHIPPING CO. (MSC) maintained its position as the lead- ing carrier in the containerized US import market despite a 32.2% year- over-year drop in volume in the first five months of 2023, according to the Journal of Commerce's rankings of the Top 40 Container Carriers by US Imports and Exports. That decline, however, caused MSC's market share to fall to 15.2% from 18.4% in the same five-month period in 2021, narrowing the gap between it and its closest competitors. No carrier has been left untouched by waning US consumer spending, evidenced by a 22.4% drop in overall US imports through May and forecasts calling for a muted 2023 trans-Pacific peak season. Maersk, for example, fell to No. 4 from No. 2 amid a 32.1% drop in volumes, surpassed by CMA CGM and Cosco, who fared only slightly better, with shipments sliding 20% and 20.2%, respectively. Volumes at Evergreen Line, by contrast, decreased just 2.5% — one of the smallest declines among the top 40 US import carriers and by far the smallest among the top 10 — passing Ocean Network Express (ONE), which saw shipments slide 13.3%, to break into the top 5 for the first time. Hot on their heels Demand decline shrinks MSC's lead atop US import carrier rankings By Teri Errico Griffis VladSV / Asia–Med rates remain above N. Europe pricing despite GRIs Container spot rates from Asia to Europe and the Mediterranean, in USD per FEU USD per FEU $10,000 $0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 L Apr Oct Jan 2022 Apr Jul Oct Jan 2023 Jul Asia-North Europe Asia-Mediterranean Cont Con Source: Xeneta © 2023 S&P Global "June marks the fourth consecutive month of growth ... which certainly qualifies as a market rebound."

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