The global Xeneta Shipping Index (XSI), a benchmark for long-term ocean freight rates, experienced a modest decline of 1.8 per cent in March 2024, falling to 151.6 points from February, according to Xeneta. This downturn marks a significant 56 per cent decrease compared to March 2023, illustrating the ongoing challenges within the shipping industry.
March’s stagnation in the XSI is attributed to a notable lack of new contracts coming into effect, a trend influenced by both the timing within the fiscal quarter and strategic decisions by shippers to postpone new long-term commitments amidst fluctuating rates. This cautious approach is further justified by the current disparity between spot market costs, which remain higher than long-term rates, yet are on a downward trajectory, encouraging shippers to negotiate more favourable terms.
In the Far East, the export XSI dipped by 0.8 per cent to match the global index at 151.6 points, even after a brief upswing in February. This region now stands 62.4 per cent lower than its position a year prior, with the ongoing Red Sea conflict impacting spot market rates significantly at the start of the year before easing, as per Xeneta.
European import rates showed resilience with a 0.8 per cent increase to 157.4 points, the highest thus far in 2024, yet still represent a 51.3 per cent decrease on a year-on-year basis. Conversely, European exports faced a more stark decline, dropping 3.7 per cent to 159.0 points—the lowest since June 2021 and marking a 54.8 per cent fall from the previous year.
The US market reflected the most pronounced shifts, with imports plummeting by 5.6 per cent to 166.2 points, the largest month-on-month fall across all trades monitored. This index now sits 63.7 per cent below its level from March 2023, highlighting the largest annual decrease among its counterparts. US exports also experienced a decrease, albeit more modest, at 0.5 per cent, taking the index down to 124.9 points, its lowest since April 2022.
