Spot container rates rise 6.7%

Although rates from Shanghai to Northwest Europe rose 156 percent, rates from Shanghai to the Mediterranean tumbled 25 percent compared to last week.    Spot container rates increased 6.7 percent from last week’s reading of 494.10 to a reading of 527.17, according to estimates released by the Shanghai Shipping Exchange’s Shanghai Containerized Freight Index (SCFI).
   The SCFI is developed by panelists from liner companies and shipping lines, which estimate spot rates from Shanghai to 15 regions around the world.
   Since last week, rates from Shanghai to Northwest Europe skyrocketed 155.6 percent from $275 per TEU to $703 per TEU.
   The previously planned Dec. 1 rate increase on the trade was postponed to the middle of the month.
   “As always, the increase will only provide short term relief for carriers with rates likely to decline on the trade next Friday,” Richard Ward, a container derivatives broker at Freight Investor Services said. 
   CMA CGM, for example, postponed its rate increase from Asia to North Europe of $950 per TEU from Dec. 1 to Dec. 14.
   Rates from Shanghai to the Mediterranean fell 25.0 percent since last week from $780 per TEU to $585 per TEU.
   From Shanghai to the U.S. West Coast, rates dropped 8.4 percent since last week from $891 per forty-foot container (FEU) to $816 per FEU, while rates to the U.S. East Coast fell 7.3 percent from $1,625 per FEU to $1,506 per FEU.
   “With the speed of rate declines increasing over the past five years any increase that can be achieved in 2016, much like 2015, is likely be eroded in an ever shortening time span,” said Ward. “Such large weekly declines will also act as a cap on potential future increases and will make it increasingly difficult for carriers to push rates to sustainable levels unless drastic action is taken to reduce supply.”