Average spot rates on the Asia-Europe trade lane increased this week for the fifth week in a row, as European importers rushed to secure vessel capacity before the week-long factory shutdown for the Asian New Year, which begins Jan. 23.
The World Container Index of rates for shipping a 40-foot equivalent container unit from Shanghai to Rotterdam increased by 4.9 percent over the previous week to $1,401, up $66 week-over-week.
Analysts, however, caution that freight rates on the major east-west trade lanes will decline again after the New Year. “Once the pre-Chinese New Year rush recedes later this month spot rates will retreat back to December levels, unless carriers take action to remove surplus capacity from the trade,” Martin Dixon, research manager of Drewry’s Container Freight Rate Insight said last week.
This week’s index rate is up by 61 percent from last year’s low of $869 per FEU that was recorded in the first week of December. But it is still down by 55.5 percent from $2,524 per FEU in the last week of January 2012, when the WCI rate index was first published.
The WCI, a joint venture between Drewry Shipping Consultants and the Cleartrade Exchange in Singapore, publishes container freight rate indexes on 11 east-west trade routes.
The WCI for Shanghai to Rotterdam excludes terminal handling charges. It is designed as a pricing mechanism for the settlement of derivative trades and hedging and can also be used as a reference point for index-based contracts.