MaritimeNews

Down, down, down – container rates are down

Box rates continue to slide, according to data compiled by international maritime consultants, Drewry. Photo: Shutterstock.

Containerized freight rates are continuing to decline. And where gains are made, these are only marginal gains. International maritime consultant Drewry expects that ocean carriers “will struggle to recover rates” in the coming week.

Maritime consultancy Drewry notes in its World Container Index that the composite index is down by 4.4 percent this week. The composite rate fell from US$1,395 to $1,334 for a reference box of a forty-foot dry international shipping container. (All further financial references are in U.S. dollars.) That is a difference of $61 per forty-foot equivalent unit (FEU). The five-week average based on Drewry data stands at $1,334 per FEU for the composite index.

Trans-Pacific

On the trans-Pacific routes, Drewry calculates a benchmark rate of $1,504 per FEU for Shanghai-Los Angeles. This a route that is showing some volatility. The rate for the week ending Thursday, April 11 is down by 12.9 percent from the previous week’s figure of $1,726. And that figure was up by 15.5 percent from the week before, which stood at $1,495. But, if going back to the middle of March, the freight rate was $1,365. Volatile. The mean average for this route for the last five weeks is $1,496 per FEU. So the rate appears to have spiked and now appears to be heading back to trend.

Meanwhile, the Shanghai-New York rate is $2,672 per FEU, which is down 4.3 percent from the previous week. This is another trade lane that’s above its five-week mean average which currently stands at $2,536/FEU. Rates on this trade lane appear to have surged in the last five weeks from $2,442/FEU in mid-March to a peak of $2,792/FEU in early April. As rates appear to be swiftly climbing down from that peak, it could be that rates are returning to a short-term average.

Rates on the back haul look pretty flat. Los Angeles to Shanghai stands at $502, down a solid 3.3 percent, from $519/FEU last week to $502/FEU now. As the five-week average on this trade lane is $510, rates shot up and have now declined to a level lower than the short-term average.

Asia-Europe

Freight rate movements on the Asia-Europe trade routes were a bit better than the trans-Pacific as both the Shanghai-Rotterdam and Shanghai-Genoa routes were both marginally up with a 1.7 percent and a 0.2 percent increase respectively. Shanghai-Rotterdam increased slightly after a solid three weeks of bleeding. As of April 11, Drewry recorded a benchmark rate of $1,360/FEU, up by $23 from the previous week. The five-week average on this route is $1,409/FEU.

Rates on the Shanghai-Genoa route stood at $1,486/FEU. Rate changes have been pretty flat for the last three weeks but they took a dive in mid- to late March when they lost about $106/FEU in a week. As the five week-average is $1,484/FEU, it seems the current rates are in alignment with the short-term average.

Back haul rates for the Rotterdam-Shanghai trade lane were not very good; they declined by 1.5 percent, from $551/FEU to $543/FEU. The current rate is in line with the five-week average of $544/FEU.

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Jim Wilson, Australia Correspondent

Sydney-based journalist and photojournalist, Jim Wilson, is the Australia Correspondent for FreightWaves. Since beginning his journalism career in 2000, Jim has primarily worked as a business reporter, editor, and manager for maritime publications in Europe, the Middle East, Asia, and Australia. He has won several awards for logistics-related journalism and has had photography published in the global maritime press. Jim has also run publications focused on human resources management, workplace health and safety, venture capital, and law. He holds a degree in law and legal practice.

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