First increase in freight rates! European line experienced 5 months of continuous decline after sea freight rise!
Figures from the World Container Index, just released by Delury, show a small increase in shipping prices between China and northern Europe for the first time since July.
Spot rates on the Nordic route from Shanghai to Rotterdam rose 2% to $32 per FEU to $1,706.
The most recent peak was in the last week of July, when the spot price for a 40-foot container was $9,154. Rates have since fallen for 20 consecutive weeks, repeatedly by double digits.
Spot rates are different from long-term contract rates, and freight rates are constantly changing. Rates on trade routes between China and northern Europe were among the worst affected in the autumn, with the strike causing bottlenecks and chaos at several European ports.
The latest Delury WCI Composite index eased its losses this week, falling 0.3% to $2120 per FEU. That's 43 straight weeks of declines and a 77% decline compared with the same period in 2021.
On the Spanish-American trade route between Shanghai and Los Angeles, spot rates edged down another 0.4% to $1,992 /FEU this week after a slight increase in the previous week, leaving rates roughly at the same level as the previous week (down $8). This is also the first progress in months on the Spanish-American trade route.
On the Eastbound route between Shanghai and New York, rates fell 1.6 percent this week to $3,889 per FEU.
According to the container freight rate index SCFI released by Shanghai Shipping Exchange last time, the decline also narrowed, that is, the freight rate of the United States and Western Europe stopped falling, while the freight rate of the European and Mediterranean routes rose slightly.
With already low freight rates, the West America edged down 0.49 percent, the Mediterranean route recorded two consecutive periods of slight gains, and the European route edged up 0.29 percent.
In early 2022, several container shipping lines predicted that the high rates caused by the pandemic would return to normal in the autumn; But the speed with which rates have fallen sharply on some routes is still surprising, and there is the question of when they will hit bottom.
Vincent Clerc, incoming chief executive of Maersk, said rates had fallen much faster than we had expected with the energy crisis.
In mid-December, Rolf Habben Jansen, CEO of Hapag-Lloyd, expressed optimism that when looking at the current and year-end markets, as well as the Lunar New Year, he could foresee a slight recovery in demand.
Before the shipping company for the American line in January, the freight rate is expected to rise 1000 dollars, industry analysis said that at present, the West of the United States has fallen too much below the cost price may rise a little, the United States East and Europe line is still a distance from the cost price, will continue to decline, and Vietnam line has reached the bottom of the freight rate of 1 dollar.
Although the one-year contract protection discussed last year is still available in 2022, it is expected that the contract price will be greatly reduced when the new contract of European line is signed at the end of this year and early next year, and the contract of American line is signed in April and May. In 2023, shipping companies will not make money as before. It is estimated that the profit in 2023 will be more than 7-8 percent lower than that in 2022.
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