Container shipping costs across the Pacific have fallen by nearly a quarter recently, the biggest weekly drop in two years. The drop in shipping rates suggests that huge Western demand for Asian exports is slowing, although shipping industry executives say it will be months before ship congestion outside U.S. ports eases.
The drop in ocean freight rates comes at a time when the traditional container shipping peak season is coming to an end. The annual peak season usually starts in August, and foreign importers begin to purchase goods in preparation for the holiday season at the end of the year.
Now that most products are at least in transit, space is gradually opening up at the front end of the voyage, which has led to lower shipping rates.
But this cooling of demand has not yet eased congestion at U.S. ports. In large ports such as Los Angeles and Long Beach, California, dozens of cargo ships are still queued and have to wait for weeks to unload. .
Shipping industry executives said they do not expect relief until February next year at the earliest.
Since last year, global container freight rates have continued to rise, and the container market quotations on some routes have soared to more than ten times.
The drastic changes in container freight rates also have a huge impact on exports. Some commodities cannot afford the high shipping prices, and many overseas buyers have suspended orders and postponed or refused to accept orders for some low-value commodities.
Expert analysis shows that there is still a large backlog of orders in the country and the loading rate of container ships is still at a high level, so it is unlikely that freight prices will fluctuate drastically in the short term. However, on the other hand, the margin of supply and demand for containers has eased, and we need to be wary of the risk of freight price plunges brought about by the decline in loading rates in the future.
According to the latest Global-Baltic Container Freight Index (FBX) on the 12th, the Asia-US West Freight Index has dropped from 40 per cent on September 10 The price peaked at US$20,586 per 40-foot container and dropped to US$14,885 per 40-foot container.
Compared with the previous issue of $18,730 on November 5, it dropped by $3,845, or 20.5%. Compared with the high on September 10, it dropped by $5,701, or by as much as 27.69%.
The Asia-US East freight index has dropped from the high price of US$22,173 per 40-foot container on September 10 to US$16,671 per 40-foot container.
Compared with the previous period of $19,895 on November 5, it dropped by $3,224, or 16.2%. Compared with the high on September 10, it dropped by nearly $5,498, or 16.2%. Reaching 24.79%.
The Drewry Index showed that the Shanghai-Los Angeles spot rate increased by 1% to $9,947/FEU. However, Shanghai-Genoa freight rates fell by 2% or $255 to $12,438 per 40-foot container. The freight rates of Shanghai-Rotterdam and Shanghai-New York are hovering at the levels of previous weeks. Drewry expects rates to remain stable in the coming week.
While the vast number of freight forwarders and cargo owners are wary of falling freight rates, they also need to pay attention to the global congestion in the East and West of the United States. This situation is expected to continue for some time. The trend of container freight rates requires continued attention.
Southeast Asian freight rates have skyrocketed, exceeding US$2,000
What is more surprising is that freight rates have remained stable. The Southeast Asia route has also experienced a big price increase recently, with the increase as high as US$1,000 per container. Wanhai Shipping Company previously issued a notice: From November 6, 2020, prices for exports from Shenzhen to all ports in Southeast Asia will increase! +USD500/1000/1000 (20GP/40GP/40HQ). Freight rates exceeded US$2,000.
It is worth noting that in the context of tight transportation capacity , the industry frequently experiences container shortages and dumping of containers! At the same time, buyers will also abandon goods, so you need to be vigilant! Textainer and Triton, the world’s top three container equipment leasing companies, have previously stated that container shortages will continue in the coming months.
The crisis in the container shipping market is difficult to solve! Expert: It will get worse before it gets better
Maersk, the world’s largest container ship shipping company, said that the situation at the port will continue. Due to the labor shortage caused by the epidemic, the speed of ship unloading and loading has been greatly reduced, and the logistics speed is even slower.
However, as the epidemic situation slows down, demand is still increasing. There is currently no sign of this situation of greater demand than supply, including when the port congestion situation will slow down. </p
