Rates hit a 20-month high! The major shipping lines are back on this route!
Recently, the European line tariffs have been rising rapidly, market tension and the adjustment of shipping companies' strategies have led to difficulties in booking spaces even if high freight rates are paid. Freight rates on South American routes are even soaring, especially on South American East routes, where some freight rates have exceeded the US$10,000 mark.
With freight rates reaching a high point in the past two years, major shipping companies have begun to strengthen the layout of the China-Mexico route, and shipping companies such as CMA CGM, COSCO and MSC have opened the China-Mexico route one after another to meet the growing market demand.
COSCO and its subsidiary Orient Overseas opened the Trans-Pacific Latin America 5 (TLP5) service on 6 May, providing fast shipping services between China, South Korea and Mexico, with a transit time between 15 and 20 days.
In response, France's Duffy Line CMA CGM plans to launch a new M2X Mexico Express service on 11 May, calling at the ports of Tianjin (Xingang), Qingdao, Pusan, Ensenada, Manzanillo, La Zarocadenas and Yokohama. The inaugural voyage of the service will be made by the ANL Wangaratta (4,253 TEU) from the port of Pusan, and the service will be operated by eight 4,200 TEU containerships in 56 days.
Tan Hua Joo, analyst at Linerlytica, pointed out that the increase in rates on the China-Mexico route comes against the backdrop of a general rise in rates on the Asia-South America route, which has prompted carriers to shift more capacity to the route.
It's worth noting that MSC has also made adjustments to its routes, cancelling US port calls on one of its Asia to US East Coast routes, Santana, and instead focusing on calls in Central America.
The last New York call on the Santana route was made by the 15,264 TEU "MSC Martina Maria" on 29 March, and the subsequent voyage was shortened to the restructured Far East-Mexico-Panama-Dominican Republic route, with calls at Yantian, Ningbo, Shanghai, Pusan, Manzanillo (Mexico), Cristobal, Coco Solo, Caucedo and Yantian.
The restructured Santana service will commence service in week 11 with up to 11 vessels of between 8,000 and 15,000 TEU and additional port calls on the new eastbound round-the-world service.
Linerlytica noted that MSC's withdrawal from the USEC service will reduce the Far East-US East Coast route by around 10,000 TEUs per week as the company seeks to capitalise on more lucrative tariffs on the Far East-Mexico and Latin America routes.
MSC's restructuring of the Santana service coincides with the launch of its new Asia-Mexico West Coast service, calling at Qingdao, Ningbo, Shanghai, Busan, Manzanillo, La Zarocadenas and Qingdao. From 15 May, the service will have a turnaround time of six to seven weeks and will deploy 4,000-7,000 TEU vessels, with the inaugural voyage starting with the 6,492 TEU MSC Apollo from Qingdao.
Xeneta principal analyst Peter Sand said rates from the Far East to Mexico are now at their highest level since September 2022, underpinned by Mexican demand for Chinese imports increasing by more than 33 per cent year-on-year in the first quarter of 2024," he said.
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