Concerns amid Happiness
Hyundai Merchant Marine (HMM) said on August 3 that its expected load rate between Asia and the Americas since the end of July was staying over 100%. Despite a long-awaited boom in its shipping business, a lack of vessels is compelling HMM to rack its brain to adjust routes and consider chartering vessels.
In general, the shipping industry is in its high-demand season as freight volume increases in the second half. Among them, the August to October period is the busiest season. A prolonged glut in the global shipping industry hindered fares for the Korea-Americas route from recovering despite the high-demand season. This year, demand outweighs supply due to the bankruptcy of Hanjin Shipping and a sign of a recovery in the US economy.
JOC, a global shipping magazine, predicted a significant increase in trade volume in Korea-US routes as the North American market entered a high growth phase thanks to a recent boom in the US economy and consumer spending. It is predicted that high fares will continue in August and September. It is good news to Hyundai Merchant Marine, which has been accumulating deficits due to low rates.
The Shanghai Container Fare Index (SCFI), which serves as a standard on fares, posted US$ 1226 per FEU on July 21, rising to US$ 1,687 in a week. As the volume of shipments is expected to increase further in August, the US-Xian fare is expected to exceed US$ 2,000.
Hyundai Merchant Marine is considering putting small ships into the Korea-Asia and Korea-Europe routes and using large ships to the Korea-US route. However, its small fleet is hampering such ideas. The company is also considering ways to use more chartered vessels in case the boom continues longer. To this end, HMM is busy asking shippers about their demand for the Korea-west coast of the US routes.