Ocean lines cancel India-to-US GRIs and peak surcharges

Container lines seem to be giving up hope of raising freight rates for loads from India to the US, as the market is showing no uptick in volume.

Traditionally, carriers wield the most bargaining power during the peak shipping season that gets under way in August. But this year has proved muted for them, after the rate slide began in the middle of last year.

And pessimism is prompting carriers to “undo” rate increase notices already sent out, even though the “asks” had been modest, instead of the usual hefty amounts.

MSC has cancelled peak season surcharges and GRIs which were to have come into force on 1 October. The Geneva-based carrier was intending to implement a PSS of $350 per box and GRIs of $400 per teu and $500 for all other types of loads from India to the US and San Juan (Puerto Rico).

MSC (India) earlier noted that the increases were necessary to “maintain the high level of service reliability and efficiency to meet the needs of customers”.

Other active India-US carriers, including Hapag-Lloyd and CMA CGM, are expected to follow suit in pulling any rate hikes already lined up, according to freight forwarder sources.

MSC has three weekly sailings out of Nhava Sheva and Mundra for the US east coast, while Hapag-Lloyd and CMA CGM jointly offer two Indamex sailings.

Average contract rate levels on the tradelane, the largest by value for India, have been somewhat steady to slightly decreasing over the past two months, despite multiple GRI and PSS attempts by most active carriers.

Over the past year, India-US booking rates have plummeted from pandemic-linked highs and now hover at $1,700 per teu for shipments from West India (Nhava Sheva) to the US east coast, versus about $8,000 per teu in August 2022, industry data shows.

Similarly, India-US west coast rates are down to $1,600 per teu, from about $8,500/teu a year earlier.