Red-hot ocean rates could spark government intervention

In tanker and dry bulk shipping, the rate is the rate. It’s whatever the market says it is. It can be below zero (net of costs). It can be six figures per day. No government can intervene. This is definitely not the case in container shipping.

Record-high trans-Pacific spot rates and container-equipment shortfalls in Asia have now caught the eye of powerful government regulators. The China Ministry of Transportation and Communication questioned liner reps in a special meeting last Friday.

In the aftermath of that sit-down, concerns have been raised about carriers’ ability to implement general rate increases (GRIs) and “blank” (cancel) sailings while averting future government backlash.