In the fierce competition, the stock price of the shipping giant soared, attracting market attention to this stock.

The situation in the Red Sea continues to disrupt the global supply chain, and the uncertainty of the US "Joint Escort" operation makes the prospects for shipping companies bleak.

According to reports, ZIM Integrated Shipping Services is the preferred market investment for spot freight rates. Between December 1st and 22nd last year, its stock price has soared by 60%. Due to the impact of the recent attacks by Houthi armed forces over the weekend and the announcement of the suspension of A.P. Moller - Maersk A/S Unsponsored ADR, the stock price of ZIM Integrated Shipping Services has risen for two consecutive days this week, with a more than 15% increase on Wednesday and a trading volume on Tuesday that is twice the average trading volume.

The Red Sea crisis, coupled with Goldman Sachs' upgrade of A.P. Moller - Maersk A/S Unsponsored ADR to "Neutral", jointly pushed up the stock price of A.P. Moller - Maersk A/S Unsponsored ADR, which continued to rise by 5.1% on Wednesday after a 6.4% increase in the previous trading day.

Since mid-November last year, when the Houthi armed forces began their armed attacks in the Red Sea area, the stock prices of ZIM Integrated Shipping Services, A.P. Moller - Maersk A/S Unsponsored ADR, and Hapag-Lloyd have accumulated increases of approximately 68%, 34%, and 23% respectively.

After being repeatedly attacked by the Houthi armed forces, A.P. Moller - Maersk A/S Unsponsored ADR announced on Tuesday that it will once again indefinitely suspend transit through the Red Sea and divert to the Cape of Good Hope. Hapag-Lloyd also announced the suspension of Red Sea shipping last Friday. Shipping companies such as Switzerland's Mediterranean Shipping Company and France's CMA CGM have also suspended Red Sea navigation. It is certain that if the Houthi armed group continues to stir up trouble, it will mean higher shipping costs and longer delays, and maritime trade will be further affected.

Surge in freight rates on multiple routes

The Red Sea crisis has greatly impacted trade on the Asia-Europe route, which previously accounted for 30% of the flight volume on this route.

According to analysts at Goldman Sachs, the Asia-Europe route is the largest trade route for A.P. Moller - Maersk A/S Unsponsored ADR, and the freight rates on this route have increased by about double since early December. French shipping group CMA CGM, which is not listed, announced on Tuesday that its container freight rates from Asia to the Mediterranean region have increased by 100% since January 15, compared to January 1.

Due to the drought in the Panama Canal, the freight rates for Asia to the US East Coast flights, most of which have been diverted to the Suez Canal, have also been pushed up.

According to estimates from Platts, a subsidiary of S&P, on Tuesday, the freight rates from Southeast Asia to the US East Coast are $4,100/FEU (40-foot standard container), and the rates from Southeast Asia to the US West Coast are $2,900/FEU. The rates from North Asia to the US East Coast are $3,800/FEU, and the rates from North Asia to the US West Coast are $2,800/FEU. These rates have increased by 86%, 81%, 65%, and 78% respectively since early December.

In addition, it is reported that quarterly liner freight may also be severely affected in the short term due to vessel diversions.

Mikkel Emil Jensen, Senior Analyst at Sydbank, said on Wednesday:

"Freight rates are rising significantly, and the increase will exceed any costs of sailing around Africa."

However, the current capacity constraints on the global supply chain are still limited, and Goldman Sachs predicts that they will not exceed the levels seen during the pandemic.

Goldman Sachs believes that the main reason is that the shipping industry is still in a state of "supply exceeding demand", and the bank predicts that the fundamentals of A.P. Moller - Maersk A/S Unsponsored ADR in 2024 will be: "The current situation of 'getting by' will not lead to price competition."

Linerlytica, a shipping consultancy, stated this week:

"Driven by the Asia-Europe route, freight rates on all long-haul routes have shown strong growth. It is expected that capacity will remain high in January and February, as capacity will still be tight in the next six weeks."