Maersk to hike Asia-to-Europe rates again

COPENHAGEN (Reuters): Danish oil and shipping group A.P. Moller-Maersk A/S said it would increase Asia-to-Europe container rates for a second time this year, calling existing rates unsustainable.

The world’s biggest container shipping company will hike rates for both Dry and Reefer cargo by $500 per twenty foot equivalent unit (TEU) from April 15.

“The prevailing freight rates from Asia to North Europe and the Mediterranean make it unsustainable and financially unviable to offer our current range of services and consistently high schedule reliability,” Maersk wrote in a letter to customers.

Maersk Line and its nine biggest rivals have already pushed through rate hikes of $424 in March to $1.423 per TEU, according to rate index SCFI.

Maersk Line has struggled in the past few years as the container shipping industry has been hit hard by overcapacity and a global economic slowdown.

Analysts are mostly optimistic of a modest pick-up in world trade this year, as growth in Asia and recovery in the United States make up for sluggish European markets.

But new and bigger vessels delivered from Asian shipbuilders are expected to enter the market in the months to come, adding to existing overcapacity.