Dollar Rates Should Limit Box Line Exposure To Euro Crisis

by Lloyd's List - last modified Jun 04, 2012 12:44 PM

While ocean carriers are already seeing a slowdown in cargo volume growth on trades into Europe, which may undermine efforts to raise freight rates further, their actual exposure to the euro is relatively limited.

“We are primarily a US dollar currency company in terms of main revenue streams,” says Maersk Line.

The same is true of leading container lines based in Eurozone countries that nevertheless conduct most of their business in dollars, such as Germany’s Hapag-Lloyd or France’s CMA CGM.

Euro-denominated freight rates are rare, mostly limited to the intra-Europe and some South America trades. Earlier attempts by one or two lines to start using the euro in the Asia-Europe trades never came to anything.

But those carriers that accept payment in euros for the convenience of customers say they would quickly switch to dollars should the need arise.

Most of the lines contacted by Lloyd’s List say they have no specific contingency plans to cover a Greek exit from the euro or even a total collapse of the currency, but say they are closely watching events as they unfold, and are in constant touch with their banks.

“We have for a while been monitoring the situation in Europe closely but do not see a need for any new major proactive changes to the way we operate in the region or to our financial plans,” says Maersk head of group finance and risk management Jan Kjaervik.

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