{"id":1792,"date":"2021-03-08T18:09:00","date_gmt":"2021-03-08T18:09:00","guid":{"rendered":"http:\/\/www.bocintl.com\/web\/?p=1792"},"modified":"2021-03-12T18:10:33","modified_gmt":"2021-03-12T18:10:33","slug":"the-boc-blast-401-ocean-carriers-increasing-europe-usa-trade","status":"publish","type":"post","link":"https:\/\/www.bocintl.com\/web\/the-boc-blast-401-ocean-carriers-increasing-europe-usa-trade\/","title":{"rendered":"The BOC Blast 401 \u2013 Ocean carriers increasing Europe USA trade"},"content":{"rendered":"\n
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Vestager to examine competition in red-hot container market<\/h2>\n\n\n\n

By Louise Wendt Jensen, Astrid Sturlason \u2013 Published: 08.03.21 at 14:59, ShippingWatch.com<\/em><\/p>\n\n\n\n

EU Competition Commissioner Margrethe Vestager now plans to scrutinize the extreme situation unfolding in the global container market together with the industry. The EU will subsequently \u201cconsider ways forward,\u201d a spokesperson tells ShippingWatch.<\/p>\n\n\n\n

Copenhagen\/Brussels<\/strong><\/p>\n\n\n\n

The European competition authorities will now \u2013 together with the industry \u2013 examine the current conditions in the global container market. Conditions that have so far been criticized by both US and Chinese authorities.<\/p>\n\n\n\n

Rising freight rates, growing container shortages and major delays have long been the consequence of a red-hot market that has seen extraordinary demand for transporting goods from Asia to Europe and the US during the coronavirus pandemic.<\/p>\n\n\n\n

\u201cWe are discussing with market participants, i.e. shippers, freight forwarders, port operators, carriers, to fully understand the current circumstances, and consider ways forward,\u201d says a spokesperson for Margrethe Vestager, EU executive vice-president and competition commissioner, in a comment to ShippingWatch.<\/p>\n\n\n\n

\u201cIt seems that these price increases were caused by a combination of factors, such as fluctuating high demand, port congestion, and shortage of containers, in markets which are intertwined at worldwide level,\u201d the spokesperson continues.<\/p>\n\n\n\n

This is the first time the EU exhibits such a clear reaction to the current situation in the container market, seeing as the EU\u2019s stance is often more tentative and based on a requirement that evidence must first be presented \u2013 at least if it concerns a possible breach of the container liners\u2019 particularly favorable competitive conditions.<\/p>\n\n\n\n

The rate boom and current customer dissatisfaction with the low service levels have already led authorities in both the US and China to speak up. The Chinese authorities last year summoned the world\u2019s largest container lines to a meeting in which they were urged to curb rates.<\/p>\n\n\n\n

The Federal Maritime Commission in the US has also upped its surveillance of the three large container alliances, under which the world\u2019s largest container lines have organized themselves.<\/p>\n\n\n\n

Criticism of liner companies<\/strong><\/p>\n\n\n\n

Shipping companies such as Maersk have been under scrutiny from the US authorities, which now demand monthly updates from the carriers in order to monitor the market. Previously, these updates were only given quarterly.<\/p>\n\n\n\n

Maersk has \u2013 like many of its competitors \u2013 acknowledged that its service is currently substandard, but the carriers also all refer to the extraordinary circumstances created by the Covid-19 pandemic.<\/p>\n\n\n\n

\u201cWe\u2019re actually dismayed by the level of service we\u2019re forced to provide right now,\u201d said Maersk CCO, Vincent Clerc, recently.<\/p>\n\n\n\n

\u201cIt doesn\u2019t feel like a big high five moment right now. It feels like a moment where too many customer promises are not being delivered on and we are all hands on deck in trying to alleviate the situation,\u201d he said.<\/p>\n\n\n\n

Maersk CEO S\u00f8ren Skou has set a stated target of bringing the company\u2019s reliability up to between 85 and 95 percent as early as 2021. In January this year, this figure sat at 46.3 percent for Maersk\u2019s ships against 76.4 percent in January last year.<\/p>\n\n\n\n

Criticism from US agriculture<\/strong><\/p>\n\n\n\n

In the US, associations like the Agriculture Transportation Coalition and transport associations such as HTA have voiced their opinions. Just last week, Global Shippers\u2019 Forum also voiced its criticism.<\/p>\n\n\n\n

In a new review, GSF criticized shipping companies for continuing to provide poor service while cashing in record-level rates.<\/p>\n\n\n\n

The industry association\u2019s quarterly survey, conducted by MDS Transmodal, examines eight key performance indicators (KPIs).<\/p>\n\n\n\n

\u201cImporters and exporters around the world are paying record high shipping rates but receiving appalling levels of service reliability,\u201d asserts Global Shippers\u2019 Forum in the review.<\/p>\n\n\n\n

Difficult for shippers to resolve<\/strong><\/p>\n\n\n\n

Organizations the European Association for Forwarding, Transport, Logistics and Customs Services (CLECAT) and European Shippers\u2019 Council (ESC) have previously urged the European Commission to take action against the container lines, which they believe to be taking advantage of their special position and special competition exemption.<\/p>\n\n\n\n

But so far, this has not been possible.<\/p>\n\n\n\n

Because in order to do something, the two associations must either submit a formal, well-founded complaint about the competitive conditions or wait for the EU to, at some point, begin their evaluation of the so-called Block Exemption Regulation (BER).<\/p>\n\n\n\n

BER is a special competition regulation that allows the container majors to coordinate their efforts through alliances such as, for example, Maersk and MSC\u2019s 2M alliance. With the alliances, container lines are able to coordinate their networks and utilize space aboard each others\u2019 vessels, if their market share is lower than 30 percent, that is.<\/p>\n\n\n\n

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Vestager to examine competition in red-hot container market By Louise Wendt Jensen, Astrid Sturlason \u2013 Published: 08.03.21 at 14:59, ShippingWatch.com EU Competition Commissioner Margrethe Vestager now plans to scrutinize the extreme situation unfolding in the global container market together with the industry. The EU will subsequently \u201cconsider ways forward,\u201d a spokesperson tells ShippingWatch. Copenhagen\/Brussels The<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[507],"tags":[],"class_list":["post-1792","post","type-post","status-publish","format-standard","hentry","category-the-boc-blast"],"_links":{"self":[{"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/posts\/1792","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/comments?post=1792"}],"version-history":[{"count":1,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/posts\/1792\/revisions"}],"predecessor-version":[{"id":1793,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/posts\/1792\/revisions\/1793"}],"wp:attachment":[{"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/media?parent=1792"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/categories?post=1792"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/tags?post=1792"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}