2016 has been a year of turmoil and upheaval within the ocean freight market – the formation of new alliances, mergers and acquisitions and a bankruptcy of a major ocean liner. With these changes in mind, we asked the opinion of some industry players if the ocean freight market is becoming a seller's or buyer's market. Nothing was conclusive, but it for sure made for some interesting discussions.

1. Is The Ocean Freight Market A Buyer's
Or Seller's Market?

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5. 2016 has been a year of
turmoil and upheaval within
the ocean freight market –
the formation of new
alliances, mergers and
acquisitions and a
bankruptcy of a major ocean
liner.

6. With these changes in mind, we asked
the opinion of some industry players if
the ocean freight market is becoming a
seller's or buyer's market. Nothing was
conclusive, but it for sure made for
some interesting discussions.

7. A Buyer's Market With
Uncertainty

8. Although the market is in recovery with
spot market rates trending upwards, it
seems the industry as a whole is not yet
convinced that carriers are in for a
long-term win. A good number of our
conversations revolved around the opinion
that the market is still a buyer's market
and carriers can't yet call victory.

9. The overall the market has been trending up for a few months.
With november's gris holding steady in Asia-Europe spot market
and an increase reported last week, at the moment, we can't deny
that carriers are doing a bit better than in q2, for example.
What may be more surprising or perhaps not surprising at all is
the fact that most folks we spoke to indicated they were not sure.
2016 has been an unprecedented year for the ocean freight
market.

10. More Big Boys Taking Sail In
2017

11. We shouldn't forget
that next year we will
see some large
shippers taking sail
which is anticipated
to add more capacity.
Maersk has 11 new
triple e's (Asia
-Europe) coming into
play from april 2017
part of their organic
growth strategy.

12. The acquisitions and bankruptices this year haven't done too
much to address the oversupply issue.

13. [He is concerned] about how long the
momentum would be maintained given the
fundamental oversupply of space, which is
expected to be exacerbated by new
ultra-large container vessel (ULCV) deliveries
next year. All the mergers and acquisitions
this year, and even the Hanjin bankruptcy,
haven’t done anything to address the
oversupply side of the industry
- Patrik Berglund (CEO)

14. Alliances, M&AS And
Bankruptcies Oh My

15. Earlier this year, the
number of alliances was
reduced to three – the
alliance, 2m and the
ocean alliance. Combined,
these alliances will have a
commanding share of
major trade lanes.
or example, for the largest
lane, Asia-Europe, the
three alliances combined,
is estimated to have a
99% share of the capacity.

16. The uncertainty of what this may bring to shippers in april 2017
when the alliances goes into effect is apparent in the large
percentage of respondents that noted they were not sure what
kind of market ocean freight is moving towards.
In addition, with maersk acquiring Hamburg süd, there are now 11
global carriers, down from 20 at the start of the decade.
According to online publication, splash 24/7, Israel’s Zim, is
looking to reduce its global presence and focus more on regional
transport while Yang ming and oocl are denying they are looking
at sale opportunities. Splash 24/7 speculates that for the right
price senior management at both lines would sell or possibly
merge together.

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