Feb 02

2017 Contract Season Update 2017-2-2

Source:  JOC.com

Higher than usual sailing cancellations during Chinese New Year on the trans­Pacific and Asia­Europe trade lanes is the latest example of ocean carrier capacity discipline amid annual contract negotiations.

The deep capacity cuts forecast by SeaIntel come as spot rates on both trades are at least 50 percent higher than those quoted last year a week before Chinese New Year celebrations began on Feb. 7, kicking off a two­week shuttering of Asian factories. Blanked sailings are at their highest level in four years, and although trans­Pacific cuts will be deeper than last year, they won’t be as drastic as they were around the Chinese New Year in 2014 and 2015, SeaIntel Maritime Analysis CEO and partner Alan Murphy told JOC.com.

“Based on patterns of spot rate developments in past years, we are expecting spot rates on Asia­Europe and trans­Pacific to drop 15 percent to 20 percent in the coming weeks, but second­quarter spot rates we estimate to be up 90 percent to 150 percent year­over­year on Asia­Europe and 150 percent to 170 percent year­over­year on Asia to US West Coast,” he said.

Asked about the heavy capacity cuts expected in the next couple of weeks, a spokesperson for Orient Overseas Container Line said: “It is important that carriers constantly keep a close eye on the changes in the market and the performance of their products to ensure they are meeting customers’ requirements.”

The extent to which trans­Pacific and westbound Asia­Europe spot rates hold, or more likely, fall, give shippers insights (http://www.joc.com/maritime­news/trade­lanes/trans­pacific/trans­pac­spot­rates­signal­state­carrier­discipline_20170124.html) into just how much discipline carriers will have in matching capacity to demand, rather than chasing volume at lower rates. The spot rates are taken as a base on which to negotiate contracts.

While the majority of Asia­Europe service contracts are negotiated toward the end of the year, some large shippers are still in talks.

The supply chain director of a global European retailer said, “We negotiate rates from April­March so it gives us the benefit of a few months to see what happens to the market, but suffice to say we’re expecting relatively significant increases over [2016] rates and less choice for us given the consolidation that’s happening in the market place.”

Another Asia­ based global shipper said his company only opened its tender in January and would not know the scale of the increases until early February.

“We are certainly hoping for a price war, but the real market won’t show its face until the other side of Chinese New Year” he said.

Compared with a 10­ week average of pre­Chinese New Year capacity, Asia­ Europe carriers will cut capacity 40 percent in the first week after Chinese New Year, 25 percent in the second week, and 31 percent in the third week, according to SeaIntel.

Asia­ Europe carriers slashed capacity more dramatically in the first week of the Chinese New Year in 2016, reducing space available by nearly 53 percent. Although carriers pulled back in the following two weeks, reducing capacity 20 percent and adding nearly 1 percent, respectively.

On the trans­Pacific, SeaIntel expects carriers to cut nearly 27 percent of capacity in the first week of the Chinese New Year, and then 19 percent in the second week and nearly 4 percent in the third. Those are far sharper cuts then during Chinese New Year in 2016, when capacity shrunk 11 percent in the first week and 18 percent the second, before 2.5 percent more space became available the in third week, according to SeaIntel.

Heading into the Chinese New Year, trans­Pacific spot rates measured by the Shanghai Shipping Exchange’s Shanghai Containerized Freight Index to the West and East Coasts are 77 percent and 55 percent higher than the week before the lunar celebration last year, respectively. The current spot rates to move a 40­foot­equivalent unit from Asia to the US East and West Coasts are both higher than many of the 2017­2018 contracts carriers are trying to secure from major retail BCOs.

The rate to the West Coast is $2,167 and the East Coast rate is $3,647, while carriers are seeking to lock down annual contracts, which generally run from May 2017 to May 2018, in the range of $1,600 to $1,800 per FEU to the West Coast and about $2,450 per FEU to the East Coast, according to conversations with carriers, shippers, and consultants.

After some major shippers signed contracts last season for as little as $750 per FEU to the West Coast, contributing to the billions of industry­wide losses in 2016, carriers are putting on the pressure. Some carriers, for example, are asking shippers for rates $100 to $300 higher than what was being shopped around in late December and early January, arguing they can lock down rates now or risk higher costs once they get alliance network details.

The Ocean Alliance has detailed nearly all its port rotations, but THE Alliance hasn’t disclosed specific ports for network placeholders, such as “South China/Hong Kong,” “Los Angeles/Long Beach,” and “Caribbean Hub,” according to SeaIntel. The analyst expects the network of the 2M, now with a Hyundai Merchant Marine partnership component, to remain unchanged.

Depending on the relationship with the customer, how the contract is structured, and how much volume is committed, carriers may settle for West Coast rates of $1,000, and $2,300 to the East Coast, a container line executive told JOC.com last week on the condition of anonymity. Still, these are hardly major advances, considering a $1,600 to $1,700 rate was once considered poor, the executive said.

Whether carrier discipline will hold is unknown, but they do have some momentum. The capacity cuts that have been made, and are to continue, have helped prop up spot rates, according to data from Xeneta. The rate management platform looked at the spot rate developments around Chinese New Year 2016 compared with this year and found that on the day before the Chinese holiday began, the market average spot rate in 2017 was almost double that of 2016.

On the Asia­North Europe trade this year, the market average rate the day before Chinese New Year on Jan. 27 was $2,301 per 20­ foot ­equivalent unit compared with $1,057 on the same day the year before. By March 7 in 2016, the market average spot rate had plunged to $695 per FEU.

It was the same picture on the Asia­Mediterranean trade. On Jan. 27 2017, the market average was $2,057 per TEU, while it was $861 per TEU on the same day just before the Chinese New Year in 2016. The spot rate had declined to $504 per TEU by March 7.

Patrik Berglund, Xeneta CEO, said how the short­term market developed after the Chinese New Year would be important. Noting that carriers have shown capacity discipline in the past only to fold later, Berglund told JOC.com that this time around alliances have all trimmed capacity at generally equal levels, boding well for a measured approach — at least in the short term.

“If, as we’ve seen historically, it plummets quickly after that then it might very well rapidly change from a seller’s to a buyer’s market again,” he said. “If it sticks, the shippers sitting on the fence, waiting for Chinese New Year to blow over might have lost out on the opportunity to contract, as they’ve done historically, according to the calendar year for Europe and then, as quickly as possible, for the trans­Pacific corridor.”

Contact Greg Knowler at greg.knowler@ihsmarkit.com

Contact Mark Szakonyi at mark.szakonyi@ihsmarkit.com

Jan 18

New Carrier Enters Trans Pacific Market – SM Line

Source:  JOC.com

SM Line plans to deploy five ships acquired from Hanjin Shipping with capacities of 6,500 twenty-foot-equivalent units on a service connecting China and South Korea to the Port of Long Beach in April.

That will provide an in-house network for the newest trans-Pacific entrant’s sister companies and inject new capacity as the next wave of shipping alliances launches. Executives from the Samra Midas Group, a South Korean-based manufacturing, construction and services conglomerate, told US Federal Maritime Commissioner William Doyle last week that the service will call on Shanghai and Ningbo, China, and Busan South Korea.

SM Line also plans to deploy 11 vessels ranging from 1,000 TEUs to 2,500 TEUs on eight intra-Asia services between China, Japan, Thailand, Vietnam, India, Pakistan, Indonesia, and other countries, Doyle told attendees of a National Retail Federation event in New York on Monday.

In addition to trying to break into a competitive market, SM Line will likely have to rely heavily on non-vessel-operating common carriers for its volume as beneficial cargo owners tend to shy away from new entrants. Shippers are scrutinizing the health of even long-time trans-Pacific carriers after Hanjin Shipping collapsed Aug. 31, leaving hundreds of thousands containers in limbo.

SM Line will set sail without the help of an alliance, which allows partner carriers to better ensure they are operating heavily loaded by pooling their cargo among members on more efficient mega-ships. The lines making up the new alliances — Ocean Alliance, THE Alliance, and 2M + Hyundai Merchant Marine — that launch in April controlled 82.4 percent of Asia imports to the United States in 2016, according to PIERS, a sister product of JOC.com within IHS Markit.

Underscoring the competitiveness of the market, over the last six years at least six container lines — including Hainan POS, Grand China Shipping, and T.S. Lines — have entered the trans-Pacific trade lane only to pull out in 2011 and 2012, according to industry analyst Alphaliner.

The SM Group in November beat out HMM for control of Hanjin’s trans-Pacific and intra-Asia networks. The intra-Asia trade, once an assured source of revenue and profit growth for container lines, has found itself victim to the same forces of overcapacity and weak demand that plague the major east-west trades. Chronic congestion at key ports in the region meanwhile has driven up liner operating costs.

The SM Group has a wide range of commercial interests including steel, aluminum, textile, and chemical production as well as credit and engineering services. The conglomerate is also involved in construction and battery, shipping materials, and beauty products manufacturing. The formation of SM Line is the company’s second endeavor in shipping, having acquired South Korea’s No. 2 bulk carrier Korea Line in 2013.

Jan 04

1st Quarter 2017 Ocean Import Rate Update

JOC.com

There is little expectation that the solid increase in freight rates that built through December and into the new year will last as container shipping’s weak fundamentals reassert themselves in the slack post-Chinese New Year period.

Asia-Europe spot freight rates reached their highest level since July 1 in the final week of December, continuing a steady increase that began late in the first quarter. The year-end rate rise was even more dramatic on the Asia-US East Coast route, which hit its highest level of the year on Dec. 30, passing the $3,000 per 40-foot-equivalent unit mark in the process. Rates are updated weekly at JOC.com’s Market Data Hub.

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Sanne Manders, chief operating officer of Flexport, told JOC.com that shipping lines were using the uncertainty in the market to raise rates, and that a shipper negotiating a contract right now would be paying 20 to 25 percent more than last year.

“There was a perfect storm in the last five months with Hanjin Shipping’s failure and the peak season coming at the same time, which allowed the shipping lines to bring up the rates,” he said. “But this will be temporary. If you look at the underlying fundamental economics, the overcapacity remains, so what you will see is that the rates will go back to the same low base rates that we saw last year.”

Manders said the economics could not be escaped and overcapacity was here to stay.
“There will always be moments when rates will spike — before China’s ‘Golden Week’ in October or in the weeks before Chinese New Year because of front loading to get the goods out of the factories. But beyond Chinese New Year, the prices should go down,” he said.

This view was supported by Lars Jensen, CEO and partner at SeaIntelligence Consulting, who wrote in his blog that the lingering effects of the Hanjin collapse and the associated “flight to safety” from some shippers might underpin rates, but this did not sustainably change the supply-demand dynamics.

“That being said, it is entirely plausible that rate levels in the beginning of 2017 will show marked improvements over 2016, but that is because the start of 2016 had rate levels hitting absurdly low levels on the back of a very low oil price and a dysfunctional price-setting mechanism among the carriers,” he said.

Jensen also believes the phase-in of the Ocean Alliance and THE Alliance from April carries with it a high risk of a price war, and said it was inevitable the new alliances would want to assert their positions in the key markets.

Accompanying the rise in spot market rates in the run up to the new year was an increase of Chinese manufacturing. Factory production in December expanded at the fastest pace in nearly six years, according to the Caixin China general manufacturing PMI.

Some expect the sustained increases in container shipping rates through the fourth quarter will not be sustainable throughout 2017.

Supported by a solid increase in total new orders, companies raised their purchasing activity at a quicker rate than in November. December recorded a PMI of 51.9, the strongest reading since January 2013. Anything over 50 is regarded as expansion.

Zhengsheng Zhong, director of macroeconomic analysis at CEBM Group, said the sub- indices for factory output and new orders both hit multi-year highs, and those for input costs and output charges continued to rise rapidly, underlining sustained inflationary pressure.

“The Chinese manufacturing economy continued to improve in December, with the majority of sub-indices looking optimistic,” he said. “However, it is still to be seen if the stabilization of the economy is consolidated due to uncertainties in whether restocking and consumer price rises can be sustainable.”

The Caixin China report on general manufacturing is based on data compiled from monthly replies to questionnaires sent to purchasing executives in over 500 manufacturing companies. It is a composite indicator designed to provide a single-figure snapshot of operating conditions in the mainland manufacturing economy.

Contact Greg Knowler at greg.knowler@ihsmarkit.com and follow him on Twitter: @greg_knowler.

Nov 01

Import Container Rate Market Analysis – October 2016

Source for below data:  Drewry UK October 2016

  1. Review of Spot Rate Trends; Supply and Demand Trends

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2.  Review of New Orders of Containers

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3.  Contract Rate Forecast

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4.  Contract Rate Trend Review:

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Oct 02

Assessing Health of Carriers – September 27, 2016

www.joc.com

Shippers are being urged to have a good look at the financial situation of carriers before committing their cargo, but that is going to be a complicated procedure once the new alliances are in operation from April 2017.

Even if a shipper selects a healthy carrier, few members of those three alliances — 2M, Ocean, and THE Alliance — are in good shape, and there is no guarantee containers will travel only on a particular carrier.

The Drewry Z score index of publicly listed carriers shows the top five shipping companies are safe from bankruptcy, but those five lines are spread across the three alliances that kick off next year. For instance, Ocean Alliance member Orient Overseas International Ltd, the parent of Orient Overseas Container Line, is at the top of the list based on its 2015 annual results. CMA CGM is at No. 3 with a slightly negative first-quarter earnings before interest and taxes, but the financials of the other two partners, Evergreen Line and China Cosco Shipping Lines, are not very pretty.

Evergreen’s EBIT for the quarter ending March 31 was a negative $131 million, while China Cosco Shipping in August recorded a first-half loss of $1.08 billion. Much of the Chinese line’s losses are from its bulk shipping sector and the absence of government subsidies in the first half for the early scrapping of ships.

THE Alliance lines also have some impressive losses among them. Hapag-Lloyd’s first-half loss was $159 million, while the three Japanese lines’ financial year ending March 31 saw MOL with a $1.5 billion loss, “K” Line with a loss of $470 million and NYK Line the only one in profit at $166 million. Yang Ming’s first-quarter net loss was $116 million. Hanjin Shipping was to be member number six until its banks walked away.

If the 2M Alliance does end up including Hyundai Merchant Marine, it will have a loss-maker for a partner with a sizeable amount on debt on its books. Maersk Line itself made a $151 million loss in the first half.

Drewry expects container lines to lose between $5 billion and $10 billion this year as freight rates remain low amid surplus capacity and weak demand.

“With so much uncertainty shippers will probably look to hedge their bets with the alliances at the beginning and see which one works best for them in the long-term,” according to the analyst’s Container Insight Weekly.

Drewry said the uncertainty over what the industry will look like is “less than ideal” as shippers prepare tenders for shipping contracts. “None want a repeat of the Hanjin situation with billions of dollars’ worth of cargo stranded outside ports and they will want to know in advance which carriers will be sharing ships to avoid those that they consider to be financially risky,” it noted.

But John McCauley, vice president of transportation and logistics at Cargill, said at a recent conference that if financial health was the only criteria used by shippers when choosing their carrier partners, no one would be shipping anything.

“Many shippers are having to reassess their tactics,” he said. “Do we go by carrier or by alliance? That is important so we can keep a balance of the service requirements we need and the ships that are going to deliver our products.

“There is sufficient competition between carriers to ensure we have enough choice. We look at the financial strength of an organization, their ability to invest, the quality of customer service. Price shouldn’t be the sole determinant,” he said.

“Like everyone, we will refine and look at our carrier selection process. The other soul searching will be less about the sourcing and more about how Hanjin was managed.”

McCauley said the collapse of the South Korean carrier had shocked the industry. “Hindsight is great, but when you look at the extent of business affected — $14 billion of business impeded and in some cases thrown into the toilet — and ask if the industry could have managed it better? With the inability of any individual customer to influence what is going on, I am not sure it could have.”

Contact Greg Knowler at greg.knowler@ihsmarkit.com and follow him on Twitter: @greg_knowler.

Sep 26

Hanjin Shippers getting “Gouged” by Railways, Terminal Operators and Container Lessors According to Hanjin

Hanjin Shipping told a bankruptcy court in Newark, New Jersey Friday that railways, terminal operators and container lessors are price gouging the South Korean line’s shippers by asking those cargo owners to pay more than usual to bring freight into US ports, in the wake of Hanjin’s recent bankruptcy filing.

The world’s seventh-largest container line has told courts that cargo owners are withholding up to $80 million in payments due to the company for completed shipments.

Meanwhile, in the court documents filed Thursday, Hanjin refuted media claims that a South Korean judge ordered the ocean carrier to return all chartered vessels that have completed unloading their cargo to their shipowners and to cancel their charter agreements.

“Although Hanjin believes such price gouging is wholly inappropriate and has tried to intervene (including notifying the Federal Maritime Commission), there is nothing more Hanjin or the Foreign Administrator can do,” the shipping line said in a court filing Thursday.

Those transportation providers could end up in hot water after Hanjin said in its progress report to the court it has notified US maritime regulators of what it describes as a “wholly inappropriate” industry response to its financial woes.

Even though US courts have granted Hanjin creditor protections to help avoid chaos at US ports, logistical problems have persisted and ships have remained stranded at sea as transportation providers have refused to touch the South Korean carrier’s assets. Some of those companies that are willing to help are demanding higher fees to unload and deliver cargo, according to progress report Hanjin submitted to the court.

The new court documents reveal that the South Korean ocean carrier is aware and is attempting to resolve the reports of price gouging. The container line added, however, that other than notifying the US maritime regulators, there is little or nothing it can do to rectify the situation shippers now face.

The FMC has had some success in helping cargo interests minimize costs and retrieve cargo stranded by the bankruptcy, according to FMC Commissioner William P. Doyle.

“Based on past experience during tumultuous times, we know that ocean carriers and marine terminal operators begin charging detention and demurrage charges that become extremely expensive in short order,” Doyle said. “The FMC is monitoring this scenario closely. In the current state affairs, the shipper, through no fault of its own, is precluded from returning equipment and/or picking up cargo.”

The FMC has received more than three dozen Hanjin-related complaints since the South Korean carrier filed for receivership on Aug. 31, Doyle said. Now Hanjin’s recent progress report suggests there could be more victims and that number could jump if additional shippers step forward.

“There have been reports in the media that the Korean Court ordered Hanjin to return all (US and non-US bound) chartered ships to their owners. That report is inaccurate,” Hanjin said in the filing.

Five of the 14 vessels that were bound for US ports at the start of the Korean bankruptcy proceeding are currently outside US waters or anchored at sea in those waters, according to Hanjin. Four of those 14 vessels have been arrested: the Hanjin Montevideo at Long Beach, the Hanjin Vienna at Vancouver, the Hanjin Scarlet at Prince Rupert and the Hanjin Baltimore at Panama. Hanjin said in its Thursday progress report that it has made payments to all bunker suppliers for the Montevideo and the company is still in the process of trying to resolve the other liens on that vessel.

The other vessels listed in the court document have departed from their final destinations or are en route now. The Hanjin Miami is currently berthed in New York and will soon sail to Wilmington, North Carolina and then to Savannah. The Hanjin Chongqing is expected to arrive in New York on Oct. 27.

Other vessels though, like the Hanjin Switzerland, are not listed in the court filing at all. According to shippers with cargo on board and data from AIS Live, a sister product of JOC.com within IHS Markit, the Switzerland is destined for New Jersey but is sitting in the Red Sea, apparently unable to transit the Suez Canal because — like many other Hanjin vessels — the ship is unable to pay the canal tolls.

The situation, and the ongoing lack of information, has been described as “disastrous” for one shipper’s business already. Moreover, there are concerns that the lengthy proceedings ahead could reduce capacity and raise spot rates. The gaps in supply chains could also produce a backlog that, while short in term, might keep some goods off shelves during the holiday shopping season.

In a positive step, there have been continuous and ongoing efforts to raise financing for continued operations, according to the Hanjin progress report. Since the filing for rehabilitation in Korea Aug. 31, Hanjin has secured approximately $45 million in financing. Approximately $37 million of that is from Hanjin’s chairman. The remaining approximate $8 million was contributed by Hanjin’s former chairwoman.

Korean Airlines, Hanjin’s parent company, is also finalizing a loan agreement whereby the airline would loan $54 million to the ocean carrier. The funds are planned to be earmarked for continued business operations, including the berthing of ships and the loading and unloading of containers throughout the world, Hanjin said.

“All port-service providers and terminal operators have been paid in cash, in advance, for all work required to be performed on Hanjin vessels that have called ports in the United States,” the Hanjin said. “Additionally, Hanjin has, or will, issue amended and re-rated bills of lading and invoices to the BCOs (beneficial cargo owners) to reflect charges only up to the port of discharge for containers that were originally contracted to be delivered to the BCOs inland.”

Contact Reynolds Hutchins at reynolds.hutchins@ihsmarkit.com and follow him on Twitter: @Hutchins_JOC.

Sep 26

Hanjin will not Charge for Late Returns of Empty Containers

NEWARK, New Jersey — Hanjin Shipping told a US District Bankruptcy Court Friday that it would not charge shippers for late return of containers, after a trade association representing the intermodal freight industry asked the court to prohibit such charges.

The Intermodal Association of North America in a court filing that banning the container line from levying “per diem” charges would bring certainty to businesses in a turbulent environment, and “bring welcome clarity to the marketplace,” allowing businesses to make “sound business decisions.”

But Ilana Volkov, an attorney for Hanjin, told Judge John K. Sherwood that the company would not be pursuing that policy,

“Normally speaking, if they do not return a container they get charged a detention charge,” she said. “Hanjin is not charging detention.”

Per-diem detention charges are governed by the Uniform Intermodal Interchange and Facilities Access Agreement, which IANA administers. The agreement, to which Hanjin is a party, sets out the terms under which intermodal equipment is used by shippers, trucking companies and others.

IANA said it filed the papers in part to make the court aware of the agreement, and also to head off its use in the Hanjin case.

“Our hope is to get ahead of assessments of per-diem charges and to avoid the confusion and subsequent arbitration claims that were filed last year based on the disruptions that occurred on the West Coast,” the organization said in a statement.

The association said the Hanjin disputes could have an “exponentially larger effect” on the dispute resolution process than did the West Coast port disruptions accompanying longshore contract negotiations in late 2014 and early 2015.

Hanjin filed for bankruptcy protection in a Korean court on Aug. 31. The filing produced confusion as truckers and cargo interests tried to return Hanjin containers and their accompanying chassis to off-hire locations specified in contracts. Many terminals or depots refused to accept the boxes, fearing they wouldn’t be paid.

The ocean carrier has asked the US court to accept the South Korean bankruptcy filing as a Chapter 15 case, which would allow attorneys for the container line to take bankruptcy-related actions rsuch as pursuing money owed to the company in the United States.

The court has not yet accepted the application, but on Sept. 6 granted the liner temporary protection that prevents debtors from seizing ships as a means to ensure Hanjin settles its debts.

IANA told the court that under the uniform intermodal agreement, “Hanjin has an obligation to accept the return of containers and chassis used as part of its business.

“However, vast numbers of containers and chassis are presently not being accepted, and Hanjin has not notified motor carriers of any alternative return locations,” the association said.

As a result, “at present, great uncertainty exists in the intermodal market” as to whether Hanjin will try to collect per-diem payments on the “thousands of units of intermodal equipment that cannot be returned or picked up,” the court papers say.

IANA argues that allowing the carrier to make per-diem charges would create a “wave” of disputes over the charges and place an excessive burden on the volunteer arbitration panel that hears disputes over the charges.

Joni Casey, president and CEO of IANA, welcomed Hanjin’s statement that it would not charge detention, saying “today’s actions will alleviate the need for unnecessary arbitrations on this issue in the future.”

Per-diem charges were a major source of contention between terminal operators and truckers in late 2014 to mid-2015 when West Coast ports sustained severe congestion during the coastwide contract negotiations between the International Longshore and Warehouse Union and the Pacific Maritime Association.

According to IANA figures, 137 claims were filed through the dispute resolution mechanism of the interchange agreement. IANA said 17 claims were rejected because of tardy filing, 37 claims were resolved by the parties prior to assignment to an arbitration panel, and 83 claims resulted in arbitration decisions.

Contact Hugh R. Morley at Hugh.Morley@ihsmarkit.com and follow him on Twitter: @HughRMorley_JOC.

Sep 15

Carriers Replacing Capacity Lost By Collapse of Hanjin

www.joc.com

Hanjin Shipping’s collapse has set off a rush by other container lines to add services and “extra loader” voyages to pick up the South Korean carrier’s abandoned market share on routes to, from, and within Asia.

China Cosco Shipping Lines, CMA CGM, and Yang Ming will join Hyundai Merchant Marine, Maersk Line, and Mediterranean Shipping Co. in offering extra capacity to trans-Pacific importers. The largest concentration of new capacity is on Asia-US West Coast routes, where Hanjin had a 7.54 percent market share in the first half of this year, according to PIERS, a sister product of JOC.com within IHS Markit.

The idling of Hanjin’s services has produced a spike in trans-Pacific rates, according to readings from the Shanghai Shipping Exchange, as displayed on the JOC.comMarket Data Hub. Drewry’s index of Hong Kong-to-Los Angeles spot rates held steady this week at $1,743 per 40-foot container, after a 40 percent jump last week, suggesting US importers using Hanjin aren’t having trouble finding slot spaces on other carriers. The index’s previous high for the year was $1,418 in January.

Alphaliner identified nine Asia-to-West Coast extra loaders that are under way or planned in September, with six more scheduled for October. Carriers adding ships on this route include the 2M Alliance of Maersk Line and MSC; HMM, Cosco China Shipping Line, CMA CGM, and Yang Ming.

HMM plans four Asia-US West Coast voyages in September and two in October, using four ships with capacities of 4,700 to 6,700 twenty-foot-equivalent units.

The rotation will be Gwangyang, Busan, Los Angeles, Gwangyang, with an additional call at Shanghai next week to load cargo in advance of China’s Golden Week national holidays, which begins Oct. 1. At least two additional voyages are planned in October. Some of HMM’s G6 partners are taking slots on those sailings, Alphaliner reported.

Within a week of Hanjin’s Aug. 31 receivership filing, Maersk Line and MSC announced an additional trans-Pacific service within their 2M Alliance. The new service is designated TP-1 by Maersk and Maple by MSC.

The first two sailings will link Yantian, Shanghai, and Busan to Long Beach. Subsequent voyages will call Busan, Shanghai, Yantian, and Prince Rupert, British Columbia. Maersk and MSC said the service will use 4,000 to 5,000-TEU ships, but the first two voyages will use ships with capacities of 7,800 and 9,400 TEUs.

CMA CGM, Cosco, and Yang Ming have each scheduled one-time voyages by ships between Asia and the US West Coast. The extra loaders are Cosco’s 8,500-TEU Xin Ou Zhou, CMA CGM’s 4,800-TEU APL Oman, and Yang Ming’s 4,200-TEU YM Vancouver.

Hanjin’s halt in operations also has produced changes on other routes.

Evergreen Line, “K” Line, and Yang Ming plan to take slots on an Asia-Mediterranean joint service that Cosco and United Arab Shipping Company provided within the Ocean Three Alliance. The slot deal will substitute for capacity previously provided by Hanjin within the CKYHE Alliance.

In another change, NYK Line eliminated the Middle East-Southeast Asia leg of a joint service the Japanese carrier previously operated with Hanjin. The service will continue to operate between Southeast Asia and the US West Coast, using eight NYK ships. Hanjin had contributed four of the 12 ships used on the longer service.

In the intra-Asia trade, the Korean carriers HMM, KMTC, Sinokor, and Heung-A have planned four weekly long-haul services on routes that Hanjin previously covered in Korea, China, Vietnam, Thailand, Malaysia, Indonesia, and Singapore.

Contact Joseph Bonney at joseph.bonney@ihsmarkit.com and follow him on Twitter: @JosephBonney.