Though ocean freight rates have stabilized, importers and exporters should prepare for a “choppy ride” through the rest of this year, Drewry Supply Chain Advisors warned Thursday.
Despite another year of excess capacity growth, Drewry expects global freight rates to rise through 2013, even though the majority of new ship deployments are destined for the already overburdened east-west trade lanes, where pricing is expected to come under pressure.
The London-based consulting firm said in its latest Logistics Executive Briefing that stronger growth in demand in the north-south trades will buoy up rates enough to lift average global container freight pricing.
Drewry is forecasting a modest increase of 4 percent in average global freight rates in 2013, with variations between different routes.
“We expect freight rate volatility to continue as carriers grapple with increasing overcapacity and resort to their preferred short-term measures of sailing suspensions and frequent general rate increases,” Drewry said.
The short-term revival in east-west pricing has faded in the face of weak headhaul demand and rising fleet capacity. Drewry’s Global Freight Rate Index, a weighted average across all main trades excluding intra-Asia, consolidated the gains of December with a 2 percent increase in January to $2,513 per 40-foot-equivalent unit. This brought the index to its highest level since August 2012 and just 4 percent off last year’s peak month of June.
The trade routes contributing to the index’s rise were the eastbound trans-Pacific; Middle East exports to both Europe and North America and imports from Asia; as well as northbound exports from South America, Africa and Oceania.
The routes that experienced falling rates in January included the westbound trans-Pacific backhaul trade; South Asian exports to Europe and imports from Asia; the eastbound trans-Atlantic; and imports from Asia by South America and Africa.
Drewry said several other trade lanes remained stable, including both legs of the Asia-Europe trade; the trans-Atlantic westbound; Asian imports into Oceania; and the regional intra-Europe trade.