News Highlights week: 17- 2020

Carriers, including Maersk, Cosco Shipping Lines, and Hapag-Lloyd, are launching a short-term program of blank sailings on the East Coast South America-Asia trade that could see capacity slashed by more than half in the next month. The move is intended to shore up freight rates that have dropped to around $900-$1,000 per FEU from about $2,400 per FEU at the beginning of the year. 
Ocean Network Express has provided the first evidence of the impact of blanked sailings on carriers’ lifted volumes. The Singapore-based carrier’s transpacific liftings fell 6.7% in the three months to the end of March, indicating that other carriers will report similar volume decreases when they begin to publish first quarter of the year results from the beginning of next month. 

U.S. oil prices as well as international benchmark Brent crude have seesawed this week. The May contract for U.S. benchmark West Texas Intermediate dived deep into negative territory earlier this week, for the first time in its history, and traded at negative $37.63 per barrel. That meant producers had to pay traders to take the oil off their hands. While Brent tumbled overnight to its lowest since 1999, at $15.98, it did not enter into negative territory. (CNBC)
In a letter to the Ministry of Shipping and port-terminal stakeholders, the Container Shipping Lines Association (CSLA), which represents foreign carriers in India, said the latest inventory numbers at Jawaharlal Nehru Port Trust (JNPT) suggest a supply chain bottleneck of alarming proportions is beginning to take shape even as carriers took a raft of proactive measures to induce cargo clearance. (Journal of Commerce)
Ship recycling activities in India — home to some of the biggest shipbreaking yards in the world — have resumed after almost a month, following a complete standstill when
India announced a nationwide lockdown to slow the spread of the coronavirus. However, the resumption of ship recycling activities is being strictly monitored through mandatory thermal screening, social distancing, handwashing at regular intervals and with adequate personal protective equipment for all workers. 
Danish Shipping said it was “deeply concerned” about the latest example of earmarked state aid by the South Korean government. “This follows a series of other Korean government support initiatives, which has led to the construction of vessels, that there
is currently no demand for,” said Jacob Clasen, executive director of Danish Shipping, the association which represents the Danish shipping industry. 
CMA CGM from July will deploy its APL brand exclusively on the transPacific trade, where the carrier holds the second-largest market share behind Cosco Shipping and its subsidiary line OOCL. 

MKT