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Freight rates jump as Hanjin collapse spurs supply shock
[COPENHAGEN] The cost of transporting containers from ports in Asia to Northern Europe and the United States jumped this week after the collapse of South Korean Hanjin Shipping Co Ltd.
Container spot freight rates on the world's busiest routes from Asia to Northern Europe jump 36.6 per cent to US$949 per twenty-foot equivalent units (TEU) this week. Rates increased by 51 per cent to the US West Coast and 45 per cent to the US East Coast.
Following the Hanjin default there has been a considerable rise in freight rates, brokerage firm Fearnley Securities wrote in a note to clients on Friday.
"To our understanding this has been driven by shippers being reluctant to put their cargoes on Hanjin vessels, whilst ports are not accepting the vessels as they are afraid of not getting paid," Fearnley wrote.
A Hanjin spokeswoman said that 44 of its 98 container ships had been denied access to ports including Shanghai, Sydney, Hamburg, and Long Beach, California. One ship had been seized, in Singapore.
As the collapse happened in the midst of the peak season it has spurred a supply shock in a market which, despite poor freight rates, was characterized as relatively tight, the Fearnley note said.