CCFI Commentary Issue 25, 2018
  Date:2018-09-05

Freight rates slid on most routes

  In this week, China export container transport market demand remained stable. Shipping lines’ difference on marketing strategy diverged spot rates. However, due to intensified competition, overall market trend was downward. On June 15th, Shanghai (Export) Containerized Freight Index (SCFI) issued by Shanghai Shipping Exchange (SSE) quoted 777.70 points, down by 3.5% from previous week.

  In the Europe route, the market has been gradually booming, and the overall demand for transportation has been steadily rising. This week, the average slot utilization rate ex Shanghai reached over 95%. Backed by this, spot market rate almost kept even with previous week. On June 15th, freight rate in the route from Shanghai to Europe (contains seaborne related surcharges) quoted USD862/TEU, slightly down by 0.9% from one week ago. In the Mediterranean route, it was seen rapid increase in market volume in recent. The average slot utilization rate ex Shanghai remained above 95% with some voyages departing with full loads. Due to the healthy fundamentals, some carriers lifted their booking rates again, which drove the spot market rate rising continuously. On June 15th, freight rate in the route from Shanghai to Mediterranean (contains seaborne related surcharges) quoted USD915/TEU, up by 1.2% from last week ago.

  In the North America route, according to the latest published data, the number of applicants for unemployment benefits in the United States to the beginning of June 9th has decreased. The number of layoffs remains low, indicating that there is a shortage of manpower in all industries in the United States. As of the week of June 2, the number of unemployed workers in the United States dropped to 1.697 million, the lowest level since December 1973. As the healthy fundamentals of US economics, the transportation demand kept stable. However, due to the capacity increase on the trade lane, the slot utilization rate ex Shanghai to USWC and USEC both waved between 90~95%. As of sufficient supply of capacity, although the volume of goods showed strong performance, the market's spot rates lacked upward momentum, and carriers’ willing to compete for market share led to a drop in spot freight rates. On June 15th, freight rates in the routes from Shanghai to USWC and USEC (contains seaborne related surcharges) quoted USD1266/FEU and USD2236/FEU, down by 6.8% and 5.0% respectively compared to last week.

  In the Persian Gulf route, market still suffered from the low demand during Ramadan, Even carriers’ made great efforts on curbing the capacity supply to ease the situation of imbalance of supply-and-demand, there was no obvious improvements on the slot utilization rate. This week, the slot utilization of departed voyages diversified from 70%~90%. The spot market rate almost held the level on the base after falling in previous week. On June 15th, freight rate in the Shanghai to Persian Gulf route (contains seaborne related surcharges) quoted USD544/TEU, slightly down by 0.5% from previous week.

  In the Australia/New Zealand route, cargo volume maintained at low level during the off-season. The result of carriers’ irregularly contraction on capacity supply was not significant. The average slot utilization rate ex Shanghai maintained around 85~90%. Affected by the soft fundamentals, carriers cut their booking rate to compete for more consignments. The spot market freight was pressured to downward. On June 15th, freight rate in the Shanghai to Australia/New Zealand route (contains seaborne related surcharges) quoted USD710/TEU, down by 6.2% against one week ago.

  In the South America route, the destination market entered into the peak season of consumption which drove the shipping demand up accordingly. The average slot utilization rate ex Shanghai was on around 95%. However, some carrier’s followed the market trend to cut their booking rates for market share. The spot market rate was eroded further from the sharp rising at month beginning. On June 15th, freight rate in the Shanghai-South America route (contains seaborne related surcharges) quoted USD1673/TEU, a week-on-week decrease of 15.9%.

  In the Japan route, cargo volume performed better tan market expect, market rate rebounded. On June 15th, freight index in the China to Japan route quoted 739.97 points, up by 3.7% compared with last week.

 

File DownLoad


© 2001-2015 Shanghai Shipping Exchange All Rights Reserved.   Copyright Declaration      Contact us
Shanghai ICP B2-20050110