Freight Rates "Price War" Amid Lunar New Year

Carriers Slash Rates to Secure Cargo

Recently, leading liner companies, including Maersk and MSC Mediterranean Shipping Company, have started lowering Asia-Europe freight rates. The move aims to fill vessels during the traditionally slow post-Lunar New Year season and capture market share ahead of February's alliance restructuring.

According to a report from Linerlytica, Maersk has taken the lead in aggressive pricing strategies. "Maersk has once again adopted an aggressive pricing approach, with rates dropping to less than $4,000 per 40-foot container in mid-January," the report noted. "This has prompted MSC to follow suit, offering rates as low as $3,840, setting a benchmark for competitors' rate cuts."

Challenges Looming Ahead

The report further highlighted, "Liner companies are lowering their January quotes to fill vessels for the post-Lunar New Year off-season." While February may see an increase in blank sailings, the upcoming reshuffling of container shipping alliances could provide temporary relief. The transition to the Gemini, MSC Independent, and Premier Alliance services is expected to cause significant disruption to regular schedules.

Nonetheless, both shippers and carriers anticipate that Asia-North Europe freight rates will continue to decline throughout the year.

Reshaping the Maritime Market

The restructuring of the shipping market will reshape industry dynamics, potentially decreasing market concentration. During the early phases of new alliance formations, intensified competition is expected as carriers vie for market share. The most direct strategy—rate cuts—will likely exert downward pressure on freight rates.