Ocean freight rates plummeted and will enter a normal price increase cycle later
The latest Shanghai Containerized Freight Index (SCFI) shows that the freight index has fallen for six consecutive weeks, with the four major shipping routes all showing a downward trend, with the US route seeing the largest drop.
Last week, the freight rate per FEU from the Far East to the US West Coast fell by US$637 to US$2,907, a weekly drop of 17.97%; the freight rate per FEU from the Far East to the US East Coast fell by US$871 to US$3,954, a weekly drop of 18.05%.
The freight rate per TEU from the Far East to Europe fell by US$30 to US$1,578, a weekly drop of 1.87%; the freight rate per TEU from the Far East to the Mediterranean fell by US$191 to US$2,624, a weekly drop of 6.79%.
On the near-sea route, the freight rate per TEU from the Far East to Kansai, Japan remained unchanged at US$305 compared with the previous week; the freight rate per TEU from the Far East to Kanto, Japan remained unchanged at US$308 compared with the previous week; the freight rate per TEU from the Far East to Southeast Asia fell by 17 to US$440 compared with the previous week; the freight rate per TEU from Far East to South Korea remained unchanged at US$137 compared with the previous week.
Shipping companies lower their quotations for early March
Industry insiders pointed out that China may not fully resume work until mid-March or the end of March, and the recovery of shipments at that time will be the key to affecting the freight rate trend. At present, the European line has seen a "freight rate inversion" phenomenon, with the spot market price of about US$2,200-2,600 per FEU, while the contract price is US$2,500-3,200.
Faced with the current price inversion phenomenon, shipping companies also plan to increase freight rates in March. In mid-February, leading shipping companies such as Maersk, CMA CGM, Hyundai Merchant Marine and Wan Hai Lines announced that they would increase freight rates on Asia-Europe, trans-Pacific and intra-Asia routes, with increases generally ranging from 5% to 15%.
But a week later, Maersk lowered its European route quotation to $3,200/FEU for the 10th week (March 3-9). Mediterranean Shipping (MSC) continued to use the quotation of $2,290/FEU at the end of February from March 1 to 2, and the quotation dropped to $3,940/FEU from March 3. Currently, Yang Ming Marine Transport (YML)'s self-operated FP2 route is quoted at $2,800/FEU, and other routes are quoted at $3,000/FEU, which is the lowest FAK quotation in early March.
The fact that the price was reduced instead of increased does not necessarily mean that the shipping company's price-supporting measures were ineffective.
On February 24, Yunquna said that on the European route, some shipping companies have adopted measures such as reducing flights and controlling cabin space, and announcing price increases in advance to support freight rates. However, as March is the seasonal off-season for the European route, the market cargo volume is relatively unstable after the holiday. Although there has been a recovery, it is very slow. In addition, most shipping companies have not yet resumed operations in the Red Sea, and the market acceptance is generally not high.
The subsequent increase may continue
In addition, Lei Yue, head of the shipping group at Haitong Futures Research Institute, said that the market will enter a normal price increase cycle in the future. According to the seasonality of previous years, shipping companies will most likely continue to announce price increases in April, May and June.
Even if the freight rates cannot fully realize the increase they announced, at least this action will allow them to nominally raise their quotations, leaving room for subsequent price adjustments, and even achieve the goal of a small and slow increase in core prices.
Post time: 2025-02-28 14:27:18