Over the past few months the shipping industry, hereunder the feeder market, has faced radical changes in relation to increased volumes and demands. As of yet it is hard to say whether the positive tendency is an indication of a recovering market, or if it is merely an outcome of changing seasonal activities.
While the overall tendency is positive, the development has also started to cause strain on capacities and subsequently increasing the pressure on costs. The sudden increase in trade volumes has lead to a higher level of imbalance between import and export cargo along with accompanying congestion in some important ports. This in turn has lead to increased bunker costs as the circumstances, e.g. delays in ports and the necessity to utilise capacities at hand, do not allow time for economic speed of the vessels. Moreover, due to an increased demand for ships in the charter market in the past months, time charter rates have risen significantly (almost all relevant feeder charter index’s are up with about 50% within just 2 months). The limited availability has naturally made it ever more challenging to engage in short term charter agreements and consequently made schedule recovery and contingencies difficult.
These challenges and demands have affected the industry as a whole, and if it continues it will lead to further cost increases. Thus, as we have not evaded the impact, we see ourselves forced to also seeking cost recovery from our customers in line with recovery efforts done in the larger trades and we will revert in due course with more details. As this demanding situation challenges us all, we hope for understanding to this decision, which is a necessary means to maintaining the high level of flexibility and service which we always strive to deliver.
