Guaranteed container space and equipment resonates with trans-Pacific eastbound shippers as market challenges mount.
NEW YORK, NEW YORK – The New York Shipping Exchange (NYSHEX), the innovator of the first guaranteed, digital forward ocean contract, today announces significant growth in trans-Pacific eastbound and westbound trade volumes and membership as shippers and ocean carriers, more and more, experience the value of guaranteed space and equipment, and a well-defined, fixed pricing model. From June – October 2018, NYSHEX has seen 420% increase in container trade volumes and a 38% increase in memberships.
The historically volatile container shipping market fuels the need for this value. Currently, the market is challenged with impending U.S.-China trade tariff hikes effective January 1, 2019, fluctuating ocean carrier capacity, and pre-Chinese New Year demand. The IMO Sulphur regulation which goes into effect January 1, 2020 will similarly impact shippers in 2019 as freight rates are adjusted to address the costs associated with this new requirement.
NYSHEX member, Matthew Koivisto from Damco says, “Just a couple of years ago, the only thing we could really do is just make an FAK booking at a high rate and hope for the best—and half the time that booking might get rolled during a peak situation. Now we have a more secure way of offering a booking that we know is going to sail and many of our customers are pleased to have this secure option for their supply chains.”
Kim Cockrell, VP of Sales and Marketing, NYSHEX, said “This trans-Pacific peak season we saw, and continue to see shippers of all sizes struggling to obtain vessel space. We have seen an influx of some of the nation’s largest retailers acknowledging their need for contingency plans, joining NYSHEX and preparing their execution teams for NYSHEX Forward contracts. Introducing a new industry standard - cargo moving on a vessel as booked 98% of the time - is a huge step forward for ocean shipping and we are thrilled to be seeing significant recognition for its value.”
Kim continued, “We see increased confidence and interest from shippers to guarantee that their cargo will show up on time. Carriers and shippers are speaking about new business, face-to-face, and agreeing to channel it through NYSHEX to have guaranteed vessel space and equipment. With 14% fuel cost increases having been unrecovered by carriers, combined with IMO Sulphur regulation coming into play in 2020, you can count on rate volatility and, potentially, fewer service options due to capacity withdrawals this upcoming contract season. For shippers who didn’t look into free membership to NYSHEX to protect them this peak, it is in their best interest to commit to doing so this slack, to be ready."
