Drewry Trans-Pacific Spot Rate Benchmark Softens

Freight rates on the trans-Pacific started to soften a bit since the peak season surcharges imposed by some liner companies kicked in as of Aug. 1.

The Drewry container rate benchmark for the spot rate for shipping a 40-foot container unit on the Hong Kong to Los Angeles trade lane dropped by 3.1 percent to $2,737 in the week ended Aug. 16 from $2,824 in the prior week.

By The Numbers: Container Rate Benchmark.

“We are starting to see a return to sanity in the trans-Pacific shipping market, after the crazy capacity shortages and roll-overs of the last few months which our shipper clients have experienced,” said Philip Damas, division director of Drewry Supply Chain Advisors in London.

He said carriers have added about 35,000 TEUs of weekly capacity to the trade lane since May. “There have been smallish new entrants, but shipping remains a difficult area for shippers.”

It is too early to say whether the supply-demand balance will return to historical norms. “We are advising our clients to focus on the capacity question and capacity risks in the medium term, instead of assuming that there will be plenty of capacity as in the previous years,” Damas said.

Although it has softened in the last two weeks, the latest Drewry benchmark rate is still 110.5 percent higher than it was in the same week last year, when it was $1,300 per FEU.

-- Contact Peter T. Leach at pleach@joc.com.