CMA CGM offers discount vouchers to fill ships out of India as exports dip - The Loadstar

Computer render of CMA CGM methanol vessel. Credit Hyundai Samho Heavy Industries A growing cargo crunch seems to be prompting container lines serving Indian trades to devise new strategies to attract volumes to fill their vessels. Among the major carriers serving the trades is CMA CGM and the French carrier is offering discount vouchers to customers booking shipments on its spot window. For example, from India to Australia this week, it offered a "SpotOn" discount of $300 per teu, a Mumbai-based freight forwarder told The Loadstar. A sales executive at the forwarder explained that the incentive varied from trade to trade, depending on vessel utilisation factors and added: "Instead of aligning spot rates with the market, CMA CGM is offering discounts through vouchers." Most carriers swiftly align their spot rates with demand rather than indirectly discounting prices off published rates to gain more freight and forwarder sources believe CMA CGM's strategy is akin to what ecommerce platforms, especially Amazon, offer online shoppers, in the form of e-gift cards, to drive sales. Spot ocean rates on India's major headhaul trades, such as to Europe and the US, have dropped substantially over the past two months, data from market sources indicates. For example, average rates from West India to North Europe are now down to about $2,000 per teu, from $5,000 per teu in August. With container volumes slipping, the market is seeing aggressive pricing, with carriers, even within an alliance, undercutting each other on booking rates. An influx of capacity by carriers to adjust to the longer transits around the Cape of Good Hope, on top of previous service additions in anticipation of sustained trade growth out of India, also contributed to rate declines, sources believe. Indian exports, for most verticals, have been under pressure for the past few months amid geopolitical challenges. "Rising tension between Israel and Iran has led to logistics challenges, as most of our trades to Europe, Africa, CIS and the Gulf happen through the Red Sea route," said Ashwani Kumar, president of the Federation of Indian Export Organisations (FIEO). And high credit costs remain a major concern for Indian exporters navigating demand challenges and the Indian government is reportedly considering a more attractive interest subvention scheme to help tide exporters over the crisis. "The urgent and immediate need of the hour is to take steps on the liquidity front, with deeper interest subvention support and extension of the interest equalisation scheme for at least five years, creating a predictable business environment for the exporters," Mr Kumar said. But FIEO took some solace from the latest trade data, as national goods exports by value in September modestly rebounded, with a 0.5% year-on-year gain, after a steep 9% decline in August. "The marginal increase is still a good sign," the federation said.

Red Sea - The Loadstar

Egypt has suffered a $6bn hit from the Red Sea crisis and drop in Suez Canal transits, a minister has told the IMO - but Yemen's Houthis have vowed to continue their attacks. Yahya Sarea, a Houthi spokesperson claimed in a weekend televised address that Isreal-linked maritime businesses were seeking to change ownership, but the group would not recognise any changes and would continue to attack vessels going to, coming from, or linked financially to Israel. However, the Houthi definition of 'Israeli-linked' has proven inexact, with even vessels belonging to their Iranian and Russian allies coming under attack. The news suggests that most vessels transiting the Red Sea will be under threat to some extent. The blockade would continue "until the aggression on Lebanon stops... and the siege of the Gaza Strip is lifted", said the Houthis. And the group's desired outcome appears distant. Both presidential candidates in the US election have pledged to continue arming Israel, whichreportedly killed at least 71 people and injured 169 in Friday's airstrike on the suburbs of Beirut, as well as injuring six in a a drone strike on a polio vaccination centre in northern Gaza. An Israeli warship made its way through the Suez Canal over the weekend, prompting condemnation of the Egyptian government as 'abetting Israel's war'. However, Egypt said it was legally bound by international agreements to allow the vessel to pass. And foreign minister Badr Abdel Aty reportedly told IMO secretary general Arsenio Dominguez on Friday that Egypt's economy had taken a hit of some $6bn from the drop in Suez Canal revenue. There is some evidence to suggest this figure could be even higher, as the Houthis have denied access to the Suez Canal to a large number of ships for over a year. Suez has experienced a drop in traffic of around 60% since the first Houthi Red Sea attack, the hijacking of Galaxy Leader, on 19 November 2023. Before the crisis began, in FY2022-23, the Suez Canal enjoyed record revenues of $9.4bn.

Conf call redux: Stunning XPO - 'the cycle of all cycles...' - The Loadstar

Premium editor Alessandro Pasetti is someone who talks a lot. He's Italian; it's a cultural thing, so I'm told. And he just loves numbers and all-things balance sheet but even he came off XPO's 3Q earnings call looking slightly ashen faced: "Those guys... jeez, it was too much. They are good but keep talking... and talking..." This is our DeskOne snapshot coverage during the call (click to expand the table below): It was a relentlessly upbeat affair - each answer during the ...