Container spot freight rate indices showed some divergence this week, indicating that recent falls in ocean rates on the main east-west trades could be reversed next week, if only temporarily.
While Drewry’s World Container Index (WCI), which records rates paid in the past week, continued its downward trend on almost all of its routes, while the Shanghai Containerised Freight Index (SCFI), which records quotes in the past week, showed some upward movement.
The Shanghai-Rotterdam leg of the WCI slipped 4% week on week, to $2,370 per 40ft, while today’s SCFI’s Shanghai-North Europe base port leg climbed 1% over the previous week, to finish at $2,636 per 40ft.
This suggests that next week’s general rates increases introduced by a series of carriers – one example is Hapag-Lloyd introducing a new FAK rate level of $4,000 per 40ft from Far East to North Europe – may be partially sticking.
But who knows for how long, as the general trend observed in recently during times of declining spot rates is that new FAK levels halt the slide for around a week at best.
This week’s WCI’s Shanghai-Genoa leg was down 3% on the previous week, to end at $3,171 per 40ft, while the SCFI’s Shanghai-Mediterranean base port was down 5%, implying further drops next week.
The spread between WCI and SCFI on the transpacific trades was even greater, although the WCI declines in percentage terms were less steep than seen in recent weeks.
The WCI’s Shanghai-Los Angeles leg declined 6% week on week, to finish at $2,487 per 40ft, while the SCFI’s Shanghai-US west coast leg gained 16%, to reach $2,477 per 40ft.
It was a similar picture on the Asia-US east coast trades. The WCI’s Shanghai-New York route fell 4%, to $3,622 per 40ft, while the SCFI’s Shanghai-US east coast base port route climbed 11%, to $3,914 per 40ft.
Some eight carriers have GRIs coming into force on the transpacific eastbound on 1 April, of between $1,000 and $3,000 per 40ft.
And on the transatlantic, as forecast by Sea-Intelligence chief executive Alan Murphy a fortnight ago, rates have begun to decline once more – the headhaul westbound Rotterdam-New York leg of the WCI contracted 7% week on week, to finish at $2,162 per 40ft.
There was the faintest of silver linings for carriers in that backhaul rates out of North America and Europe back climbed slightly – up 3% on the WCI’s Rotterdam-Shanghai, to $500 per 40ft, and up 1% on Los Angeles-Shanghai, to $701 per 40ft.
This week media reported that some European forwarders had been offered Europe-Asia backhaul rates of as little as $7, prompting another forwarder to respond.
“$7 is silly low – might as well do free freight, as it wouldn’t cover cost of raising and invoice. However, on eastbound base tradelanes the costs are certainly negligible, as carriers are just looking at any contribution to reposition boxes.
“But with the erosion of headhaul westbound rates that were covering the full round trip of a box it is becoming unsustainable and unviable for carriers,” they added.
