CAPACITY shortages that spawned soaring rates for two years have disappeared as rates head south, according to consultant Vespucci Maritime CEO Lars Jensen, reports London's Loadstar.
'The available data shows that the fundamental support for very high freight rates has now fully disappeared and further weakening is to be anticipated,' said Mr Jensen.
'Even though small bumps in the road, in the form of a sudden short demand spike or unexpected bottlenecks could cause temporary upward rate movements, the overall rate development will continue down towards more normal market levels,' he said.
Drewry's World Container Index (WCI) recorded another five per cent fall in its Asia-North Europe component, to US$7,583 per FEU, but the indices are having to play catch-up with a very fast-moving market as carriers start to discount heavily to fill ships.
Loadstar has seen firm rates offered on sailings from China, valid through to November, now below $6,000 per FEU, with unlimited space availability. A year ago, rates from China to North Europe were around $14,000 for Antwerp and Rotterdam and $16,000 for the UK, with cargo being rolled from week to week.
However, back in September 2020, you could ship a FEU from Shanghai to Rotterdam for $2,000.
Carriers will be desperate to ensure rates do not fall to these levels again, and will endeavour to slow the erosion.
Meanwhile, on the transpacific, the WCI Asia to US west coast reading tumbled another nine per cent to $5,662 per FEU, while there was a more modest decline of three per cent for east coast rates, to $9,304. US consumer demand has held up better than in Europe and port congestion on the east coast has supported rates for the all-water services.
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'The available data shows that the fundamental support for very high freight rates has now fully disappeared and further weakening is to be anticipated,' said Mr Jensen.
'Even though small bumps in the road, in the form of a sudden short demand spike or unexpected bottlenecks could cause temporary upward rate movements, the overall rate development will continue down towards more normal market levels,' he said.
Drewry's World Container Index (WCI) recorded another five per cent fall in its Asia-North Europe component, to US$7,583 per FEU, but the indices are having to play catch-up with a very fast-moving market as carriers start to discount heavily to fill ships.
Loadstar has seen firm rates offered on sailings from China, valid through to November, now below $6,000 per FEU, with unlimited space availability. A year ago, rates from China to North Europe were around $14,000 for Antwerp and Rotterdam and $16,000 for the UK, with cargo being rolled from week to week.
However, back in September 2020, you could ship a FEU from Shanghai to Rotterdam for $2,000.
Carriers will be desperate to ensure rates do not fall to these levels again, and will endeavour to slow the erosion.
Meanwhile, on the transpacific, the WCI Asia to US west coast reading tumbled another nine per cent to $5,662 per FEU, while there was a more modest decline of three per cent for east coast rates, to $9,304. US consumer demand has held up better than in Europe and port congestion on the east coast has supported rates for the all-water services.
SeaNews Turkey
