Freight rates are starting to fall? A number of shipping companies have reduced freight...

2024-07-09 09:27

The latest Shanghai Container Export Freight Index (SCFI) was released on the 5th, and the index maintained an upward trend for the 13th consecutive week, but the increase slowed down significantly, rising slightly to 3733.8 points this week, an increase of 19.48 points from last week, an increase of only 0.52%.

It is worth noting that there was a pullback on the European route, ending the previous nine-week upward trend, and the market focused on whether the European freight rate had peaked. At the same time, freight rates on the Persian Gulf, West Africa and South Africa routes have fallen significantly.

Despite the overall trend correction, the performance of the US East trade lane remained strong, with 40-foot container (FEU) rates approaching the $10,000 mark, the highest since late June 2022.

A number of companies have lowered the freight rates of the United States and the West

In terms of the US line: with the continuous rise in freight rates and the successive launch of new ships on the market, the freight rates in the shipping market have begun to show signs of loosening as expected by the industry.

In response to this change, the industry giant Mediterranean Shipping issued a notice to customers on the evening of the 4th, announcing that the current freight rate will be extended to the end of this month, that is, the plan to increase the freight rate of $1,000 per 40-foot container originally planned for July 15 on the West and East US routes has been cancelled.

At the same time, South Korea's SM LINE also informed customers that the freight rate per FEU on the US-West route will be reduced from $8,100 to $7,500 from now on.

During June, in response to market changes and demand growth, a number of shipping companies took active measures. MEDITERRANEAN SHIPPING RESUMES MUSTANG SERVICE FROM ASIA TO THE WEST OF THE UNITED STATES; Singapore's SeaLeady launched a fast route connecting China and South Korea to Long Beach in the West of the United States in mid-June. COSCO SHIPPING is not far behind, and on June 24, COSCO SHIPPING launched the SEA3 US-West Express optimized for cross-border e-commerce needs, which operates with six container ships with a capacity of 8,533 TEU, passing through Kaohsiung, Xiamen, Yantian and Long Beach Port.

In addition, Dexiang Shipping has also decided to return to the US West market, planning to operate as an overtime vessel in July, and officially join SeaLeady's US West Express in August to further consolidate its market position through the joint operation model of joint ship dispatch.

A number of freight forwarding companies pointed out that less than a week after the implementation of the price increase plan on July 1, Senluo Merchant Marine and other shipping companies lowered the freight rate of the western route of the United States, mainly because of the emergence of overtime ships and new routes, and the increase in the freight rate of Yang Ming Shipping in the United States East was halved, only rising by 1,000 US dollars, whether it triggered other shipping companies to follow up remains to be seen.

In terms of European routes: CMA CGM seized the opportunity of the peak season in the third quarter and deployed seven medium-sized container ships of about 7,000 TEUs to open up a temporary route between Asia and Europe.The route originates in Asia and passes through the ports of Le Havre and Antwerp in Northern Europe, as well as key ports such as Foz and Malta in the Mediterranean.

The inaugural voyage is a 6,350 TEU container ship, which successfully sailed from Yantian Port in China on June 30 and is expected to continue service until the end of September.According to Peter Sand, chief analyst at the Norwegian freight information platform Xeneta, Europe's current GDP growth rate is 0.5%, which does not match the "sharp increase in freight traffic".

At the same time, freight forwarding industry insiders said that due to the tension in the Red Sea region of the Middle East, European importers generally advanced their procurement plans, and frequent strikes in France and Germany further disrupted the shipping order.Despite this, the industry generally believes that the current demand has not really reached a strong level, so it is expected that there is a possibility of a correction in freight rates at any time.

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