Asia-Europe Trade lane

The Asia – Europe trade lane has once again been affected by its low numbers in international trade and shipping. Unfortunately for companies like Maersk, it has been dragging lower and lower and last year they started losing money due to rising fuel costs as well as low capacity on their ships. This not only affected their bottom line for the region but it affected the company as a whole. This year they have already announced a major general rate increase that hikes the rates to almost double for ships moving between Asia and Europe. This is going to be especially difficult for the shippers who are doing business in these areas since other companies will soon follow suit if they have not already. The next piece of the puzzle is that Maersk made another announcement regarding the trade lane that they are going to lessen capacity by 9% on its ships. Now there will be less overall space available which they hope will rationalize the other losses that have happened over the past year. This is the old economic principle of supply and demand. By making these seemingly small changes, they hope to revive what was once a thriving trade zone for the shipping industry. As the markets in these regions begin to pull themselves out of the economic hardships from the past year, most of the shipping companies as well as those in other parts of the supply chain will be able to breathe easier even with the changes made by the shipping companies.