CCFI Commentary Issue 29, 2018
  Date:2018-09-05

Market rates remained basically stable 

  In this week, China export container transport market kept in stable. Spot market rates slightly waved on most shipping routes and the composite index slightly increased. On July 13th, Shanghai (Export) Containerized Freight Index (SCFI) issued by Shanghai Shipping Exchange (SSE) quoted 825.57 points, a week-on week increase of 1.0%.

  In the Europe route, with the market entering traditional peak season, transport demand was stable and the supply-and-demand relationship maintained in good level. The average slot utilization rate ex Shanghai kept above 95%.The market rates tended to be stable. Most carriers maintained their original freight rate offer, or only made slight adjustments to their booking rates. On July 13th, freight rate in the route from Shanghai to Europe (contains seaborne related surcharges) quoted USD882/TEU, almost same as one week ago. In the Mediterranean route, the market situation was not as good as Europe route. The average slot utilization rate ex Shanghai waved between 90%~95%. Most carriers hold wait-and-see strategy, and some carriers slightly reduced booking rates to attract more cargo. Average market rate was down by small margin. On July 13th, freight rate in the route from Shanghai to Mediterranean (contains seaborne related surcharges) quoted USD887/TEU, down by 1.8% from last week ago.

  In the North America route, with destination in the peak season, transportation demand kept in relatively high level. Affected by Sino-US trade disputes, and some carriers’ planning to suspend certain voyages, some cargo owners and shippers accelerated the pace of shipments. This week, the average slot utilization rate ex Shanghai to USWC was above 95%, and many voyages were fully loaded. Due to the good fundamentals of the market, some carriers increased their freight rate again. On July 13th, freight rate in the route from Shanghai to USWC (contains seaborne related surcharges) quoted USD1685/FEU, up by 8.4% from last week ago. In the USEC route, due to strong transportation demand, most voyages were fully loaded, which made market rate go even higher. On July 13th, freight rate in the route from Shanghai to USEC (contains seaborne related surcharges) quoted USD2710/FEU, up by 3.3% from last week ago.

  In the Persian Gulf route, affected by the unstable factors in the region, the market transportation demand continued to slump. Although carriers continued taking capacity controlling measures to reduce overall capacity, the slot utilization still showed no improvement. There were differentiations among carriers, and the slot utilization rate of most ships ex Shanghai waved between 60~90%. Affected by market fundamentals, spot market rate continued to fall. On July 13th, freight rate in the Shanghai to Persian Gulf route (contains seaborne related surcharges) quoted USD434/TEU, down by 7.7% from previous week.

  In the Australia/New Zealand route, the market transportation demand was generally stable, the average slot utilization rate ex Shanghai was around 90%. As the market performance was generally calm, some carriers slightly adjusted their booking rates, which pushed market level a little higher. On July 13th, freight rate in the Shanghai to Australia/New Zealand route (contains seaborne related surcharges) quoted USD730/TEU, up by 1.0% against one week ago.

  In the South America route, the cargo volume remained at high level and the market transportation demand was quite strong. The average slot utilization rate ex shanghai maintained above 95%, and many voyages were fully loaded. Since the majority of carriers imposed GRI at the beginning of the month, the market showed differentiations regarding the rate increase acceptance degree. Some carriers pushed rates up again in the middle of the month, but they did not get a positive response from the market. In order to improve the loading performance, some carriers lowered their booking rates andother carriers followed up. The spot market freight rate dropped significantly. On July 13th, freight rate in the Shanghai-South America route (contains seaborne related surcharges) quoted USD1587/TEU, down by 8.6% compared to last week.

  In the Japan route, shipping demand was relatively stable and the market rate was slightly adjusted. On July 13th, freight index in the China to Japan route quoted 710.02 points, down by 1.5% compared with last week.

 

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