RATES as low as US$750 per TEU were being offered between Asia and northwest Europe, according to Ricky Forman, a container forward freight agreement broker at London's Freight Investor Services (FIS).
Last time the rate sunk below $1,000 was in March - just after Chinese New Year.
In a note to clients, Mr Forman said: "We are hearing spot rates in Asia are being offered as low as $750 per TEU for Asia-NWE (northwest Europe) route."
The Shanghai Containerised Shipping Index (SCFI) put the rate at $1,055 per TEU a week ago, down $130 from the previous week, and down from $1,455 on August 1, noted American Shipper.
Richard Ward, another broker/analyst at FIS, said, "during the summer, rates have been pretty strong, but in the last month it has reversed".
He said FIS has heard some reports of very low rates offered on Zim ships as it winds down its service from Asia to North Europe.
Said Mr Ward: "$750 is free-fall. Carriers just say 'people are undercutting, let's do the same.' One or two carriers offer low rates, and then within days other carriers do the same."
He said this was the result of carriers being pressured by customers to lower rates. "At the end of the day, they know if they don't, someone else will ship it cheaper."
Mr Ward also blamed lower utilisation. In the past four to six weeks, the market has weakened in terms of utilisation, "and that pretty much drives the rate".
WORLD SHIPPING
19 September 2014 - 21:05
Broker tells clients Asia-Europe rate sank to US$750 in the last week
RATES as low as US$750 per TEU were being offered between Asia and northwest Europe, according to Ricky Forman, a container forward freight agreement broker at London's Freight Investor Services (FIS).
WORLD SHIPPING
19 September 2014 - 21:05
Broker tells clients Asia-Europe rate sank to US$750 in the last week
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