The CKYHE Alliance is reorganizing its service network for Asia-Europe and Asia-Mediterranean trades as the carriers try to counter the weak demand and excess capacity that is plaguing the route and dragging down freight rates.
Members of the CKYHE alliance, one of the four major groupings covering the east-west trades, have agreed to reorganise their service network for the Asia-North Europe and Asia-Mediterranean trades this year.
The Alliance is cancelling one of its six weekly strings between Asia and North Europe, as utilisation levels plummet and freight rates hit rock bottom.
From the end of this month the CKYHE will stop its China Europe Shuttle (CES) service, which calls at Felixstowe, Hamburg, Rotterdam and Le Havre in North Europe and deploys 10 8,500 teu ships – mostly supplied by Evergreen.
The alliance will then provide five Asia-North Europe services (the NE2, NE3, NE5-CEM, NE6 and NE7) and four Asia-Mediterranean services (the MD1, MD2, HPM-MD3 and FEM), according to a statement from Hanjin.
The terminating of Asia-North Europe NE8 loop this month will result in a 10.9 percent drop in its weekly deployed capacity on the trade, according to data from BlueWater Reporting.
According to Alphaliner, there are reports of rates as low as $100 per teu being offered by desperate carriers as load factors stubbornly remain in the 70%-80% range, despite 30 sailings being cancelled last month alone.
And the rival G6 alliance is considering permanently withdrawing its Loop 6 to North Europe following its 11-week suspension to mid-May, said Alphaliner.
The members of CKYHE alliance are COSCO, "K" Line, Yang Ming, Hanjin and Evergreen Line.