Transatlantic Container Shipping Volumes Rise As Possible Strike At U.S. Ports Hovers

Transatlantic container shipping volumes into the U.S. are making a comeback as U.S. retailers look to replenish inventories ahead of possible strike action at U.S. ports.

“There is some temptation by customers to bring in goods ahead of the labor contract expiry on Sept. 30,” Hapag-Lloyd CEO Rolf Habben Jansen said in an online news briefing, Reuters reported.

Hapag-Lloyd is the world’s fifth-largest container liner.

Freight sector analysts are closely following contract talks between cargo worker unions and port managers in case the September deadline is missed and a strike becomes imminent.

Retailers have also put in their orders sooner as they expect their goods to take longer trips around Africa to avoid Houthi-led attacks in the Red Sea, Hansen said.

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This jump in ordering by U.S. retailers can be good news for several other liner operators that ship goods across the Atlantic basin to the U.S., such as Euroseas Ltd. ESEA, Global Ship Lease Inc. GSL and Danaos Corp DAC.

This good news for container shipping comes as ZIM Integrated Shipping Services Ltd. ZIM posted very strong second-quarter earnings on Monday by capitalizing on transpacific trade into the U.S.

The company’s average freight rate for a 20-foot container came in at $1,674 for the second quarter, up from $1,193 for the same period last year. ZIM carried 952,000 20-foot containers in the quarter, up from 860,000 such containers a year ago.

ZIM posted earnings per share of $3.08 for the quarter, blowing away analyst EPS consensus of $1.79. Second-quarter revenue totaled $1.933 billion, up from $1.31 billion a year earlier.

Price Actions: Container shipping stocks trended upward on Monday.

• ZIM jumped 16.74% to close at $22.25
• Euroseas gained 6.36% to finish the day at $47.02
• Global Ship Lease rose 1.26% to $27.24
• Danaos picked up 2% to $84.23

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