Recent headlines confirm that the Maersk Line shipping company certainly isn’t out of its depth

Proudly named in April 2014 as the official shipping partner for the infamous Volvo Ocean Race, Maersk Line continues to make a huge splash in the shipping industry with yet another showcase victory firmly tucked under its belt.

This prestigious round-the-world yacht race takes place between 4 October 2014 and 27 June 2015, when seven 65-foot yachts embrace the challenge of a nine-leg journey across 10 countries, five continents and five oceans.

For its part, the event gives the well-seasoned Maersk crew a great opportunity to showcase their global capabilities by shipping some 90 containers around the world and maintaining a virtual ‘village’ across the globe for almost 1,000 participants. However, with a company logo that insists ‘Your Promise. Delivered’, Maersk has been delighted to rise to the occasion with great confidence for the 44,580 miles ahead.

Already boasting more than 600 vessels and containers equating to more than 3.8 million TEU (Twenty Foot Equivalent Unit), its little wonder that the Maersk Line has easily become the world’s largest container shipping company, with over 25,000 employees and ports in every corner of the globe.

In addition to assisting the US Navy on testing 7-100% algae biofuel on the Maersk Kalmar in recent years, the company has also won numerous awards from across the globe in recognition of its work including the Lloyd’s List Company of the Year, Best Global Shipping Line and Best Shipping Line (Asia-Europe) and Global Ocean Carrier of the Year.

Currently, Maersk Line’s container shipping makes up the largest business area for A P Moller-Maersk and in 2008 accounted for almost half of the group’s overall revenue. By 2013 it was in a position to describe itself as the largest overseas cargo carrier in the world and to date continues to provide worldwide container services, logistics, forwarding solutions and terminal activities under its associated brand names.

Yet another notable event in the company’s history dates back to 2006 upon the delivery of the world’s largest container ship (the E-Class vessel Emma Maersk) from Odense Steel Shipyard. Since then, several other sister ships have been built, with even larger container ships being made in to order to meet customer demand from across the globe.

Continually hitting the headlines, it seems the Maersk Line shipping group will stop at nothing when it comes to providing customer excellence!

Shipping News Round-up: April 2014

April has been an active news month in the international shipping industry with many major technological and infrastructural advances coming into play this month.

In the shipping services sector, an agreement has been signed at the Baltic Exchange for two leading firms to deliver media solutions to shipping, offshore and energy sector clients.

IMF is a corporate video agency, specialising in maritime services, while Jeanius Consulting, is maritime PR and marketing consultancy firm. The two companies have joined together in a strategic partnership to help companies across the shipping industry succeed in their long-term media goals through a unique combination of video & PR events.

In the past, the firms have serviced leading organisations around the world, including the UK Chamber of Shipping, Eyal Ofer’s Zodiac Maritime Agencies, V-Ships led by Bob Bishop, Alastair McGregor’s Tanker Pacific Management, James Kirsop-Taylor’s Guardian Maritime and the Shipping Professional Network in London

(SPNL).

In other technology news, Montreal-based shipping company Fednav has announced a successful pilot using drones to scout out ice hazards for freighter vessels navigating the waters of the Arctic.

The firm has found the drones are useful in relaying critical information regarding hazards and dangerous waters back to the ship. This means vessels are able to navigate through frozen waters and miss dangerous icebergs.

While those vessels have no problem keeping cool, a Japanese firm announced plans to invest in chilled cargo by expanding the number of ships in its refrigerated fleet.

Kyowa Shipping, a service provider in ocean transportation, recently installed its fleet with 25 magnum plus container refrigeration units from Thermo King to help the firm export tuna.

In terms of April infrastructure news, shipping line CMA CGM recently announced that it is doubling its capacity out of the Port of Halifax for shipments of frozen seafood, blueberries and French fries.

The company is currently the third largest container shipping firm in the world but announced plans to carry more temperature-controlled products in a co-operative agreement with Maersk Line for transporting containers out of Halifax.

 

Price Decline Is Finally Over For Standard Dry Freight Containers

Research carried out by Drewry’s, leading maritime research and advisory agency, suggests that 2014 has already seen an increase in prices for new dry freight containers. This is the first time in two years that this has been the case, following a period of gradual decline last year. Prices fell to their lowest since 2009 last year.

Drewry’s cautions however that the market remains volatile in box equipment and it is therefore too premature to draw conclusions as to whether or not the pricing trend is set to continue. It is worth noting too that the new container ships have not matched the increase – at this stage, it is just the new boxes.

There are a lot of new ships being delivered, which is now threatening to damage the balance of north-south trade so businesses need to be very careful with their own predictions. Naturally, most operators want to protect their share of the market, and that with the growing imbalance of supply and demand should be ringing warning bells around profitability for the big businesses.

At this stage, the outlook remains largely unchanged for container manufacturers this year, so optimism should be kept in check – there, but cautious. The container equipment fleet size is predicted to be below 5% growth, and the majority of that small increase will be seen on the lease side of businesses. Lease per diems are likely to struggle to maintain their rates, too, so rental is not a quick win.

Despite predictions of supply growth reaching 5.7% globally this year, and another percentage point at 6.7% next year, a sustained recovery might not happen till 2016. That is dependent on orderbooks, though with big names such as NYK and Cosco likely to place orders soon, there is some hope.

Interestingly, scrapping rates are also at record highs, and some carriers are using scrapping as a way of addressing over-supply. Other methods include slow steaming or new operational mergers and alliances, though none seem to be a quick win.

Despite the high levels of scrapping, predicted delivery profiles for the coming two years are likely to continue to damage any longer term hope of sustained recovery.

In conclusion, the increase in box prices looks to be in some part due to the lack of ‘peak season’ traditionally seen over the summer months in 2013, which meant the totals for the year were below 2012 totals, and even further behind 2011. A peak in the summer of 2014 could make a big difference to a lot of companies’ balance sheets.