Shippers negotiating new contracts this year face a major rates dilemma as the maritime industry contemplates a return to using the Suez Canal.
When carriers revert to transiting the canal, the reduction in voyage tonne-miles will begin to expose the overcapacity in the market, pushing a significant downward trend in freight rates, especially on Asia-Europe trades.
Shipping analyst Drewry estimates rerouting round the Cape of Good Hope reduced effective capacity by around 9%, «which has helped carriers once again post some very strong quarterly profits in the past 12 months».
Transit time and possible transport corridors on the China — Europe — China route.
COVID-19 will likely affect trade more profoundly than any other recent crisis. The extent of the disruption will vary by commodity, trade lane, and mode of transport, and it will be steered by local differences in the crisis’s severity
