"Sea freight continue to surge!
South America, West Africa, and South Africa see over 20% increases, with East and West US coast rates up by another 10%"
Global shipping continues to perform strongly, the whole route tariffs rose, driving the latest issue of Shanghai Container Freight Index (SCFI) rose 214.97 points to 2520.76 points, or up to 9.32 per cent; six consecutive weeks of gains, and hit since mid-September 2022 (nearly 20 months) since the highest point.
Specifically, the European and Mediterranean routes rose by 6.31 per cent and 1.07 per cent respectively, while the US West and US East routes rose even more significantly, by 14.39 per cent and 8.34 per cent respectively. The sharpest increases were on the South America, South Africa and West Africa routes, with rates rising by 22.4 per cent, 22.25 per cent and 26.65 per cent respectively.
Forwarding industry insiders analysed the current maritime market situation in depth, pointing out that vessel capacity has been affected by geopolitical tensions in the Middle East and vessel detours (nearly 3,400 vessels have been forced to change routes so far), resulting in lower turnover rates. Initially, ships tended to choose high tariff routes, however, this crowding out effect caused tariffs on other routes to rise. Meanwhile, shipments in Europe and the US have exceeded expectations. In addition to the need to replenish inventories, geopolitical and other uncertainties may have prompted customers to increase safety stock levels and ship earlier, and these factors have combined to drive up freight rates.
On the other hand, recent market concerns also include the Canadian railway workers' strike. Canadian National Railway Company and Canadian Pacific Kansas City Railway Company for failing to reach a new contract agreement, nearly 10,000 employees of the drivers' association voted in favour of the strike, it is expected that the earliest possible action may be taken on the 22nd, which will be the scale of Canada's history may be the largest strike.
Freight forwarding industry insiders roughly estimate that the strike could affect cargo imported and exported to and from the U.S. via rail lines such as IPI and RIPI, despite the small volume of Canadian cargo. Some cargo may be diverted to import ports in the southwestern and eastern United States, which will increase pressure on transport. In response to this change, shipping lines, including Maersk, have given notice that they will optimise North American west coast ports by using the Port of Tacoma as a temporary port of call for US import and export railways for the next four voyages to ease transport pressure.
Red Sea tensions on the global shipping trade is continuing to expand the impact of the current maritime market supply and demand imbalance, the global shipping prices soared. Among them, the European line shipping prices soared sharply, May 16 plate, the set of European line futures prices once rose to a high of 4321.9, once again hit a new high since the listing of the year's highest increase of 218%.
The Yangtze River Delta, a larger freight forwarding enterprise responsible person said, a large number of containers in the ‘outside wandering’, the current domestic port shortage of serious boxes, and there is a ‘cabin hard to find’ situation, at the end of May, basically all the cabin is gone, and now there is only demand without supply. A logistics company in Shenzhen said that the lack of boxes from the beginning of the port of Ningbo spread to the port of Shanghai, now the major ports are scarce supply phenomenon.
Cargo export backlog is quite serious, and I'm afraid that it will affect the subsequent orders. Industry insiders said, at present, the freight rate is still continue to rise, at present the cabin is hard to find, the demand is too strong, the serious imbalance between supply and demand, coupled with the crisis of the Red Sea, the port of plugging and other issues, the freight rate is afraid of another wave of upward movement.
SCFI Freight Index
Shanghai to Europe freight rate 3050 USD/TEU, up 181 USD, up 6.31% weekly
Shanghai to the Mediterranean Sea freight rate of 3957 U.S. dollars / TEU, up 42 U.S. dollars, weekly rise of 1.07%
Shanghai to the U.S. West price 5025 U.S. dollars / FEU, up 632 U.S. dollars, up 14.39 per cent
Shanghai to the U.S. East freight 6026 U.S. dollars / FEU, up 464 U.S. dollars, up 8.34 per cent
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Shanghai to South America line (Santos) tariff 6686 U.S. dollars / TEU, up 1225 U.S. dollars, up 22.4 per cent
Shanghai to West Africa (Lagos) tariff 4605 U.S. dollars / TEU, up 838 U.S. dollars, up 22.25 per cent
Shanghai to South Africa (Durban) container tariffs 3365 U.S. dollars / TEU, up 708 U.S. dollars, up 26.65 per cent weekly
Shanghai to Australia and New Zealand basic port tariffs for 1,259 U.S. dollars / TEU, up 7.7 per cent weekly
Shanghai to the Persian Gulf basic port tariffs for 2221 U.S. dollars / TEU, up 4.6% weekly