Container freight rates take a breather

The Drewry World Container Index (WCI,) which has been seeing double-digit percentage weekly increases recently, was up just 1% over the previous week on 11 July at $5,901 per feu.

The Shanghai Containerized Freight Index (SCFI) slid 1% to 3674.86 points on 12 July compared to 5 July levels.

The question now will be if increases are simply taking a breather, or this represents a levelling off of container spot rates.

While container spot freight rates are at extremely elevated levels, they are still well below the highest levels seen during in the pandemic. Drewry’s WCI is some 43% lower than it’s peak of $10,377 per feu in September 2021. Generally analysts think it is unlikely that rates will reach the highest levels that were seen during Covid.

Signs have not particularly positive this week though with severe storms off South Africa bringing to a halt container ships transiting via the Cape of Good Hope to avoid Houthi attacks in the Red Sea. The 18,000 teu CMA CGM Benjamin Franklin lost 44 containers overboard on 9 July while off the coasts of South Africa.

Looking ahead Drewry commented: “Drewry expects freight rates to remain high until the end of the peak season.”