Analysis of the Export Container Shipping Market and Freight Rates
Shanghai Shipping Exchange Releases Latest Data: Freight Rates Plunge Across Major Routes, Carriers' April Price Hike Plans Face Challenges
The latest data released by the Shanghai Shipping Exchange shows that as of March 14, the Shanghai Export Containerized Freight Index (SCFI) stood at 1319.34 points, down 8.1% from the previous period.
Notably, freight rates on the three major routes from Shanghai to European base ports, US West Coast, and US East Coast all recorded significant drops again, while rates from Shanghai to Mediterranean base ports also approached steep decline levels.
The latest quotations released by the Shanghai Shipping Exchange detail:
As of March 14, the market freight rate (including ocean freight and surcharges) from Shanghai Port to European base ports was $1,342 per TEU, down 15.2% from the previous period.
The market freight rate from Shanghai Port to Mediterranean base ports was $2,295 per TEU, down 8.8%.
The market freight rate from Shanghai Port to US West Coast base ports was $1,965 per FEU, down 14.2%.
The market freight rate from Shanghai Port to US East Coast base ports was $2,977 per FEU, down 10.6%.
Australia-New Zealand Route Rebounds
In contrast, the Australia-New Zealand route, which had declined for seven consecutive weeks, finally saw a rebound over the past week, recording a 16.9% week-on-week increase to $735 per TEU.
Cancelled Sailings Data & Market Dynamics
According to the latest voided sailings tracking data from Drewry:
During the upcoming five weeks covering Week 12 (March 17-23) and Week 16 (April 17-20), carriers have announced 48 cancellations out of 714 scheduled sailings on major East-West trade lanes (transpacific, transatlantic, and Asia-North Europe/Mediterranean), representing a 7% cancellation rate.
Drewry notes that as carriers focus on market share and network adjustments, the effectiveness of blank sailings is diminishing. It is forecasted that cancelled sailings will decrease by 32%, from 87 in March to 59 in April. Currently, carriers' planned General Rate Increases (GRIs) have been postponed, and further near-term rate hikes seem unlikely.
Uncertainty Over April GRIs
Meanwhile, according to industry reports, several shipping lines have announced plans to implement GRIs in early April to bolster rates, with freight forwarders receiving notifications of intended increases of $1,000 for US routes and $2,000 for European routes.
However, market sources subsequently reported that Mediterranean Shipping Company (MSC) has taken the first move by deciding to maintain its end-of-March pricing for European routes in the first week of April. This development is feared to undermine the collective momentum for rate restoration, and whether other carriers will follow suit is being closely watched by the market.
