Shifl’s forwarder drive container spot freight index Shifex for forty-foot boxes from China to Los Angeles fell to $1,825 in October, the same level that was seen in the pre-pandemic peak season in 2019.
The traditional peak season has failed to materialise this year and container spot rates have fallen sharply from record highs seen in Q4 2021 and early 2022.
Shifl pointed to a shift in the peak season to Q2 this year which was reflected in extremely strong import volumes into the US in that quarter as shippers and retailers ordered several months earlier than normal to avoid getting caught in the delays and congestion seen in the latter half of 2021. It said this could explain the tipping point now as inventories had already been stocked.
Even on the US East Coast where queues of vessels have been growing at ports rates have been sliding, although remain well above pre-pandemic peak season levels at $5,500 per feu between China and New York in October according to Shifex.
“While the Fed has increased rates and inflation still remains high, it is expected that the fall in spot freight rates will eventually alleviate inflation. It remains to be seen whether the rates will stabilise at pre-pandemic levels or will fall lower than that,” said Shabsie Levy, CEO & Founder of Shifl.
HSBC Global Research noted a slowing in the decline in container spot rates over the last two weeks with the benchmark Shanghai Containerized Freight Index (SCFI) down 2% week-on-week on 21 October. This compares to weekly drops of nearly 10% in September and early October.
“Carriers have increased blanked sailings and suspended certain services. That said, we think they need to do much more and rather quickly to stabilise spot freight rates ahead of the upcoming contract negotiations for the Asia- Europe route which typically take place during November December,” HSBC said in its Global Freight Monitor.
Copyright © 2024. All rights reserved. Seatrade, a trading name of Informa Markets (UK) Limited.
|Add Seatrade Maritime News to your Google News feed.