After the health crisis, they made record profits: Container ship owners were accused by customers of providing "bad services" for 2 years and charging high prices. They are also blamed for inflating the market.
According to industry experts, the average cost of a container for an Asia-Europe rotation has increased to over $10,000 from $1,500 at 2020's start. This is due to "spot" rates, which are only available for 30 days before the advance.
Jean-Michel Garcia (AUTF) recalls that the Covid pandemic caused a 20% drop of international trade in goods in the first quarter of 2020. This forced freight companies to "reduce their sail", to give up certain ships and containers.
However, Mr. Garcia claims that "the demand has returned at the same level as before, and the capacities are greater than ever before except that shipping companies are doing them a disservice". According to Sea Intelligence, punctuality for boats in May 2022 was only 30-40%.
Mr. Garcia denounces that "In the end it is the shipper – the customer - who pays everything with the minimum explanations and maximum threats".
There were voices that condemned this situation, including that of Michel-Edouard Leclerc (president of the E. Leclerc strategic committee), who requested that the French Parliament establish a commission to investigate the origins and consequences of inflation. This would include what is happening on price fronts from transportation to consumers.
Several countries, including the United States have opened investigations into major shipping companies. They denounce their excessive concentration. Joe Biden, the US President, recently threatened to "crackdown on companies that practice abusive pricing."
Jean-Emmanuel Sauvee (president of Armateurs de France) replies, "The cartels were illegal, and all shipowners around the world are extremely vigilant about them."
He cites the colossal investment of companies to adapt to new rules of IMO. They are required to reduce greenhouse gas emissions by 2023. "C 40,000 ships around the world will need to be modified."
Lamia Kerdjoudj is the general secretary of Feport. She represents private terminals and says there is no doubt that shipowners are not following the exemption regulation, which allows them to "to agree on the capacities".
La Feport also condemned "the bad behavior of boats arriving late to the port terminal, but it is neither a car park nor an open-air storage space. The port authorities should speak out."
It recognizes that there are connectivity issues in some ports that can delay delivery. One of the sector's leaders, who spoke on condition of anonymity, stated that all his boats were in operation and regretted the congestion of intermodal networks and port congestion, which he said was the source of tensions in supply chains.
CMA CGM in France, the leader in this sector, reduced its tariffs by 500 Euros per container for all imports from French retailers customers. This was done "to support the purchasing power French households". In the first quarter 2022, CMA CGM, the third largest shipowner in the world, posted a record $7.2 billion net profit.
The agreed "boost", however, will not change the situation of companies that are hampered by freight costs. Stephane Salvetat from Marseille-Fos freight forwarders' union testified at the Euromaritime Show held in Marseille that one of his clients was spending 1.5 million euros per annum on logistics prior to 2020. Today it is between 20-25 million... so he is contemplating opening a factory here in Europe."
Lamia Kerdjoudj of Feport says that companies are looking for subsidiaries closer to Europe and that the war in Ukraine is increasing this trend. She suggests that "Maybe, we'll purchase less far, and sell less far ...",."
