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| CCFI Commentary Issue 05, 2012 |
| Weekly Report of China Export Container Transport Market (CCFI Commentary in Issue 05, 2012) The demand on the China export box market contracted this week influenced by the 7-day holiday in China. However, the average slot utilization rate of ships out of China reduced moderately and rates rose and fell within a narrow range, with the general market presenting correction, as lines cut the capacity boldly. On Feb. 3rd, the China Containerized Freight Index issued by Shanghai Shipping Exchange stood at 943.45 points, up 2.1% from last week; while the Shanghai Containerized Freight Index issued by SSE lost 1.2% to 970.71 points. The cargo volume on the Europe service shrank obviously, caused by the shutdown of factories during the holiday. Nevertheless, the slot utilization rate remained at 90%-plus, even 100% for some sailings, as lines suspended or combined some services in advance. In order to keep themselves attractive, lines took measures like slight rate reduction or surcharges exemption amid the situation of less cargo and relatively ample available spaces. On Feb. 3rd, the freight rate plus surcharges from Shanghai to base ports of the North Europe issued by SSE tumbled 1.9％ to $723/TEU, while the all- in rate for the Mediterranean service plunged 0.5% to $775/TEU. The volume is expected to rise in the coming weeks as the reopen of factories and the market may pick up by the mid-March. It is understood that some lines plan to lift rates up substantially, varying from $200/TEU to $700/TEU, at the beginning of next month. Although some experts believe there is some room to improve, they still doubt its sustainability after a rate hike in a short space. Despite the fall of volume on the North America service, the average slot utilization rate remained above 90%, even 100% for some sailings, and rate fluctuated slightly as carriers proactively suspended some services to balance the supply and demand. On Feb. 3rd, the freight indices of services from China to USWC and USEC issued by SSE stood at 935.08 points, up 2.7%, and 1,120.60 points, down 0.2%, respectively from a month ago. According to the latest figures from Aphaliner, containers from Asia to U.S. fell 110 thousand teu, or 0.8%, from 13.35m teu to 13.24m teu last year as the low demand of U.S. customers and weak growth of economy. In the meantime, organizations including IMF still put a relatively pessimistic note on the outlook of U.S. economy recovery this year, which means trade of this nation is unlikely to pick up. If lines fail to control the new-added capacity effectively, the short-lived rebound, if it comes, can’t turn into a trend. Volume fell obviously this week on the Australia and Singapore services, as a result, rate dropped from a relatively high level before the holiday when lines carried out a rate restoration. On Feb. 3rd, the freight rate plus surcharges from Shanghai to base ports of the Australia and Singapore issued by SSE plunged 4.8% from last week to $805/TEU. The Japan service presented a similar scenario, where the average slot utilization rate stood at just 75%, 20% lower than it was before the holiday. However, rate remained stable. On Feb. 3rd, the freight index of the Japan service issued by SSE was reported at 800.86 points. |
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