Market trends in trade lanes serving the United States and actions taken by both individual ocean carriers and global alliances in response to COVID-19 and related impacts to the shipping industry were the topics of today’s non-public meeting of the Federal Maritime Commission.
The FMC regularly holds meetings to receive updates on international trade, the container shipping industry, and analysis of carrier agreement monitoring activities. The agency has heightened its scrutiny of markets, individual ocean carriers, and the three global carrier alliances in response to the unusual circumstances and challenges created by the COVID-19 pandemic. Today’s meeting focused on those developments.
Specifically, the Commission received detailed reports that addressed trends in spot rates, longer term service contracts, utilization of equipment, blanked sailings, revenue trends, the policies of individual carriers and global alliances for service changes, and what notice must be provided to the FMC when there are blanked, cancelled, or amended voyages.
The FMC is actively monitoring for any potential effect on freight rates and transportation service levels, using a variety of sources and markers, including the exhaustive information that parties to a carrier agreement must file with the agency.
If there is any indication of carrier behavior that might violate the competition standards in section 6(g) of the Shipping Act, the Commission will immediately seek to address these concerns with the carriers. If necessary, the FMC will go to federal court to seek an injunction to enjoin further operation of the non-compliant alliance agreement.