Container shipping: Container shipping giant freezes spot rates amid business chaos

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The world’s third-largest container carrier has said it will cap spot rates for ocean freight for the next five months, ceding to pressure from some customers and regulators fearing that global trade disruptions have pushed shipping costs too high.

“Although these market-induced tariff increases are expected to continue in the coming months, the group has decided to suspend any further increase in spot freight rates for all services operated under its brands,” CMA CGM SA said in a statement. on its website.

The move, which will resonate throughout the industry, went into effect Thursday and will run until February 1. Based in Marseille, France, the company said it “prioritizes its long-term relationship with its customers in the face of an unprecedented situation in the shipping industry. . ”

The cost of shipping a 40-foot container from Shanghai to Los Angeles hit $ 11,569 last week, nearly eight times higher than pre-pandemic levels, according to the Drewry World Container Index.

Global supply chains, with container transport as the backbone, are struggling to keep pace with demand for goods and overcome labor disruptions caused by Covid outbreaks. An illustration of the strained system is the queue of ships outside the sister California ports of LA and Long Beach, which hit a record 49 ships on Thursday night.

Separately, on Thursday, the Federal Maritime Commission in Washington announced the composition of its new National Shippers Advisory Committee. The 24-member panel representing exporters and importers “will advise the commission on policies relating to the competitiveness, reliability, integrity and fairness of the international maritime freight delivery system.”

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