Tag Archives: charter rates

Feeder ship frenzy putting even more pressure on supply chains

Feeder ships are smaller container vessels used to transport to and from large ports and other locations, inland or along a coast. There are many feeder ship operators, mainly clustered around larger ports. In Europe they frequently ply rivers as well as coastal routes.

Feeder operators have in the past been ‘asset-light’. In other words, they have not owned their ships– they have chartered them from shipowners.

But now, with major congestion at major ports, shippers who have large well-defined needs for container transport have been scrambling to charter these smaller vessels for their own account. The feeder operators face a bidding war for the vessels they need.

An example of the competition for ships is the recent charter by Pasha Hawaii, a US-flagged carrier, of a 2756 TEU ship on behalf of Costco. The charter rate was $1875K per day for 60 days. This astonishing rate cannot be afforded by feeder lines. It turns their economic model topsy-turvy.

Nobody ever said shipping was an easy business.

By Mike Wackett 03/02/2022

Feeder ship frenzy putting even more pressure on supply chains – The Loadstar

Vessel charters get longer and more costly as carriers continue to hunt tonnage

Here are more examples of Non-Operating Owners chartering ships. And they are increasing in price. These carriers are outside the liner alliances, and allow the ships to move as they choose instead of following liner schedules. They can choose routes which avoid the major choke points in container handling we see now.

It’s another way to escape or try to escape the port congestion we see at major ports.

But there are increasingly signs that the congestion is spreading from the major ports such as LA and Long Beach to smaller ones such as Tacoma and even some East Coast US ports.

How do carriers escape the congestion then? At least with their own ships, not assigned to rotations, they can pick and choose. that flexibility may aid in winning contracts to shop goods.

By Mike Wackett 17/11/2021

Vessel charters get longer and more costly as carriers continue to hunt tonnage – The Loadstar