Ocean freight rates 'continue to spiral down' on major east-west trades
Date: Monday, March 12, 2018
Source: Wall Street Journal
Spot ocean freight rates on major east-west shipping trades pursued their downward course this week, Drewry's latest analysis shows, with Asia-Europe and Asia-US East Coast prices declining most.
The overall World Container Index (WCI) assessed by Drewry, a composite of container freight rates on eight major routes to and from the US, Europe and Asia, is down by 6.2% to $1,374.6 per 40ft loaded container in the week to Thursday March 8, on the previous week and shows a decrease of 9.2% on the same period of 2017.
Last week the Index was down 2%.
The average composite index of the WCI, for year-to-date, is US $1,462/40ft container, which is $13 lower than the five-year average of $1,475/40ft container.
“In line with Drewry’s expectation, spot rates on key routes originating from Asia continue to spiral down, casting a pall of negativity for carriers over the mid-March rate hikes in the pipeline,” it underlined.
“Rates on Shanghai-Rotterdam lost another $146 per feu this week to reach $1,538 while rates from China to the USEC tumbled by a whopping $258 for a 40ft box to $2,460.”
However, the decline on Shanghai-Los Angeles was a modest $58 to $1,413 per teu.
Meanwhile, spot rates on the Transatlantic market remain stable.
In its latest Ocean Freight Market Update, dated March 7, freight forwarder Flexport said ex-Asia rates to the US East Coast and West Coast were down on last week and that it expected them to hold steady or decrease slightly through mid-March. It added that space was open on these routes.
It was a similar picture on Asia-Europe trade lanes where rates show a decline on on last week.
Flexport predicts that the mid-March rate increases announced by carriers are unlikely to stick.
The GRI had been scheduled to take effect on March 15 but was postponed to March 18.
Space is tight on Asia-Europe routes, it noted.
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