Ocean freight rates remain subdued

12/17/2017

Attempts by container lines to push through significant ocean freight spot rate increases this month appear to have had a minimal effect, with rates remaining broadly flat, week on week, on the main east-west trades and well below the levels in the same period last year.

Although several lines announced 1 December rate increases of between $700 and $1,000 per feu, according to the 1 December Shanghai Containerised Freight Index (SCFI) figures, which anticipate rates for the week ahead, rates to the US west coast from Asia rose by just 7.3%, or $80, to $1,177 per loaded 40 ft unit, while box prices on the Asia-US east trade grew 13.1% or $220, compared with the previous week’s figure, to $1,901 per feu.

But even with these latest gains, Asia-US west coast spot rates are about 24% lower then recorded in the first week of December last year, while Asia-US east coast rates are down nearly 27%, year on year.

Meanwhile, Asia-Europe rates are also currently significantly down, year-on-year, with attempts by lines to introduce new benchmark prices from 1 December, seeking rises of up to $1,000 per teu, failing to gain traction in the market. Rates this week on the Asia-northern Europe route grew just 5%, or $35, to $729 per teu, according to SCFI figures, with Asia-Mediterranean rates falling slightly to $593 per teu, a 0.3% drop on the previous week.

Measuring rates achieved the previous week to 30 November, the World Container Index (WCI), assessed by Drewry, recorded average spot rates for Shanghai-Los Angeles and Shanghai-New York at $1,145 and $1,820 per feu – down 17% and 1%, respectively, compared with the prior week, and falls of 29% and 18%, respectively, compared with the corresponding week of 2016.