Freight Rates Fell 8% this Week! The Biggest Drop Since the Epidemic! 11th Straight Week of Declines

Affected by the continuous development of global inflation and the slowdown in demand, container freight rates continued to decline. The latest Shanghai Container Freight Index (SCFI) was 3154.26 points, down 275.57 points from last week, or 8.03%, the largest weekly decline since the epidemic, and has been declining for 11 consecutive weeks.

Freight rates on major routes in the latest phase continue to fall
1
The freight rate from Far East to West America was US$5,134/FEU, down US$648 or 11.21% for the week;

2
The freight rate from Far East to US East was US$8,801/FEU, down US$191 or 2.12% for the week;

3
The freight rate from Far East to Europe was US$4,441/TEU, down US$347 or 7.25% for the week;

4
The freight rate from the Far East to the Mediterranean was US$5,071/TEU, down US$412 or 7.51% for the week;

5
The freight rate of Southeast Asia route was US$591/TEU, down US$158 or 21.09% for the week;

6
For the Persian Gulf route, the freight rate was US$2,057/TEU, down 7.8% from the previous issue.

7
The Australia-New Zealand route continued to fall, and the freight rate was US$2,797/TEU, down 2.0% from the previous issue.

8
The South American route fell for 5 consecutive weeks, and the freight rate was US$8,828/TEU, down US$137 or 1.53% for the week.


Among them, the routes of the West America, the Mediterranean and Southeast Asia dropped significantly last week, with weekly drops of 11.21%, 7.51% and 21.09% respectively. The highest decline was in the Southeast Asia route, with a weekly drop of 21.09%, mainly dragged down by the sharp drop in the freight rate of the Vietnam and Thailand routes.

Large freight forwarding companies pointed out that last week, the freight rate of the US West Line increased, and the freight rate per large container in Shanghai fell to US$4,600 on Monday, and was quoted at US$4,200 by the weekend, while it was around US$4,400 in South China. There are railway and port strikes in Europe and the United States. The strike at Felixstowe in the United Kingdom continued until Sunday, and the port in Hamburg, Germany was severely blocked. It is currently known that nearly half of the flights on the European line will be cancelled in September, and the market situation is still uncertain. Stablize.

Due to the looming inflation in the European and American markets, sluggish demand and overstocked inventory, as the supply of goods decreases, the pressure of shipping companies to fill the tank has led to the phenomenon of bargaining and rushing for goods, and the decline in freight rates has become a trend. Exporters in Asia pointed out that after two quarters of depletion of inventories in Europe and the United States, coupled with seasonal demand, they have begun to increase purchases, and they are expected to see results in the fourth quarter. But the reality is that major U.S. retailers have "cancelled billions of dollars in orders" in response to a buildup of inventory in non-essential categories over the past few quarters. In addition to canceling orders, price cuts have also been introduced for lower-volume categories.

The latest data released by other major freight indices show that freight rates in the spot market continue to decline. Drewry's World Containerized Index (WCI) has declined for 26 consecutive weeks, and the latest WCI composite index continued to fall sharply by 4% to US$5,985.53/FEU, down 39% from the same period last year. Shanghai-Los Angeles freight decreased by 6%, or $394 to $6,127/FEU; Shanghai-Rotterdam, down 5%, or $420 to $8,010/FEU; Shanghai-Genoa, down 2% to $8,391/FEU; Shanghai-New York Shipping fees fell 1% to $9,569/FEU. . Drewry expects rates to continue falling in the coming weeks.

The Baltic Sea Freight Index (FBX) global composite index was $5,703/FEU, down 2% for the week; the US West fell sharply by 6% to $5,419/FEU; the US East fell 1% to $9,085/FEU; the Mediterranean fell 2% to 10,235 USD/FEU. Only Northern Europe fell 1% to $9,979/FEU.

 suspension ★

According to the latest data released by Drewry in this issue, in the next five weeks (weeks 35-39), the world's three major shipping alliances have successively cancelled a total of 53 voyages. Among them, the most cancelled voyages are the THE alliance with 23 voyages; the 2M alliance has reached 22 voyages, and the ocean alliance with the least cancellation has 8 voyages;

Out of a total of 747 scheduled sailings on major routes such as Trans-Pacific, Trans-Atlantic, Asia-Nordic and Asia-Mediterranean, 65 sailings were cancelled between weeks 35 (9.29-10.4) and 39 (10.26-11.2), cancelled rate of 9%. According to Drewry's current data, during this period, 55% of the air traffic will occur on the trans-Pacific eastbound trade route.

Despite slowing demand and lower freight rates during the peak season, the market remains at extraordinary levels. The Port of Felixstowe, the UK's largest container port, is facing severe damage from the strike. Some carriers have implemented port hopping to divert cargo bound for the UK to other ports in Europe, but the situation at other ports is not much better, and then faces a strike at the port of Liverpool and railway workers.

Shippers and BCOs may face delays and associated additional costs during the critical Halloween and Christmas period. Drewry urged UK shippers and importers to monitor the situation closely and work closely with their freight forwarding partners to avoid unexpected delays and additional costs as much as possible.