Average freight rates on 11 major east-west trade lanes weakened this week according to the World Container Index composite compiled by Drewry and the Singapore Cleartrade Exchange.
The WCI composite fell week-over-week by 3.7 percent in the week ended Oct. 18, after a lesser decline of 0.8 percent last week. This week’s composite of $2,000.86 per loaded 40-foot-equivalent container unit is still 37.0 percent higher than the $1,460.63 per FEU recorded in the same week last year.
Individual routes in the composite showed some strength in the face of the overall decline.
The WCI for the westbound leg from Los Angeles to Shanghai gained 0.8 percent to $806 per FEU, and it is 48.8 percent higher than a year earlier, when the index stood at $758 per FEU.
The WCI for the eastbound leg from New York to Rotterdam, however, was flat this week at $1,952 per FEU, after gaining 0.1 percent last week. This week’s WCI for that trade lane is 12.4 percent higher than the same week last year, when it was $1,730 per FEU.
The WCI on the headhaul leg from Rotterdam to New York was also flat at $2,642 per FEU. That’s 11.4 percent higher than a year earlier, when it stood at $2,371 per FEU.
Chinese demand for European imports was flat this week as measured by the Rotterdam-to-Shanghai WCI, which came in at $1,019 per FEU after a decline of 0.4 percent last week. This week’s WCI for that trade is 48.8 percent higher than the same week last year, when the reading was $685 per FEU.
The WCI is designed to be used as a pricing mechanism for the settlement of derivative trades and hedging. However, the WCI can also be used as a reference point for index-linked contracts.