Drewry: Transpacific rates at 5-year high

Drewry: Transpacific rates at 5-year high    Drewry Shipping Consultants said its Hong Kong-Los Angeles spot container rate benchmark reached a five-year high.
   The London-based firm said the index hit $2,607 per 40-foot container in week 24, up 19 percent in the past week, and up 182 percent from the 24th week of 2009, when the container shipping market was experiencing serious overcapacity and price discounting.
   'The rebound in spot container freight rates has been phenomenal, as rates now substantially exceed pre-crisis levels of about $2,000 per 40-foot box,' said Philip Damas, director at Drewry Supply Chain Advisors and the editor of the Drewry Container Freight Rate Insight report, which contain the unique benchmark data.

Damas

   Drewry gathers and publishes weekly and bi-monthly spot container rate benchmarks on some 700 other routes, which it said show substantial year-on-year rises. It has “forecast for some time that average container freight rates, including fuel surcharges, will be much higher in 2010 than in 2009, even though the global supply-demand balance in the container shipping sector remains weak.”
   “The latest increase in transpacific container rates reflects new peak season surcharges, very tight eastbound transpacific ship capacity and a new shortage of boxes, which is becoming an issue in China as well as in the U.S.,” Drewry said.
   “A minority of transpacific shipments moves under spot rates, with most shipments committed under annual contract rates. However, eastbound transpacific freight rates under annual contracts signed in May and June for the 2010-2011 season were also more than twice the previous, low levels of the 2009-2010 season,' according to Drewry's research.
   'Whether you look at Hong Kong-to-Los Angeles, Shanghai-to-L.A., Shanghai-to-New York or Shanghai-to-Chicago, all our weekly container rate benchmarks from port to port or from port to inland point show year-on-year increases of more than 60 percent,' Damas said. 'It is a mini container shipping boom ahead of the full recovery of the real economy.”