Mixed ocean freight rates performance across major trade lanes
GLOBAL container shipping ocean freight rates fell by 1
GLOBAL container shipping ocean freight rates fell by 1.7 per cent year on year in June, with strong import results for the US and Far East offsetting declines in exports and across the board in Europe, according to the latest XSI Public Indices report from Xeneta.
The index published by the ocean freight rate benchmarking and market analytics platform currently stands 7.2 per cent up year on year, a company statement said.
May saw an eye-catching 11.5 per cent rates hike, with US container rates for imports rising by 20 per cent. This reversed previous falls on the XSI that is compiled from crowd-sourced shipping data, covering 160,000 port-to-port pairings, with 110 million data points.
Commenting on the results, Xeneta CEO Patrik Berglund said: 'Although the XSI remains 5.4 per cent higher than at the end of 2018, we have seen it shed value in the mid- to long-term, falling by 7.2 per cent between July last year and April 2019. So there is an on-going downward trend, albeit one that can be spectacularly disrupted by swings in demand, as we saw in May. Whether that trend will continue is uncertain.'
As with May, US imports were the top performer in June, with a 2.7 per cent month-on-month increase in the benchmark. The US export figure dropped by 3.7 per cent. A similar pattern was seen in the Far East, as the import indices were up 2.5 per cent against a 1.4 per cent decrease in exports. Both import and export figures were down for Europe, by 1.7 per cent and 0.8 per cent respectively, however, the benchmarks remain higher than the 2018 year-end levels.
Mr Berglund believes the China-US trade war is continuing to influence the market, with the potential for the front-loading of cargo to avoid the threat of new tariffs. In addition, upcoming peak season demand and the looming costs of IMO low sulphur compliance may boost short-term prospects for carriers.
That said, weak spot rates on the Far East Asia-US corridor, aligned to developments such as the Ocean Alliance's plans to void voyages on its transpacific route owing to lack of demand, muddy the picture, making the outlook 'too complex to call', he said.