The Shanghai Containerized Freight Index dropped after the Chinese New Year holiday break, according to the data issued the Shanghai Shipping Exchange. The rate decline of the two westbound trade lanes was in the triple figures.
During the week ending Feb. 22, rates to northern Europe fell 7.8 percent or $102 per 20-foot container to $1,199. Despite the weekly decline, the current rate is still 45.2 percent higher than the same week in 2012 when it was $826. This is the fifth straight week of decline, with the rate falling 15.4 percent or $219 from $1,418 in the second week of 2013.
Spot rates from Shanghai to Mediterranean ports also dropped, falling 8.7 percent or $110 per TEU to $1,148. This rate is 32.4 percent higher than the level of $867 in the same week of 2012. Like the rates to northern Europe, the Mediterranean rates are also in a five-week decline, dropping 5.3 percent or $208 per TEU from $1,356 in the second week of 2013.
Rates to the U.S. fell this week but, as has been the pattern so far this year, held up better than the Asia-Europe rates. Spot rates to the U.S. East Coast slipped 2.5 percent this week or $89 per FEU to $3,517. Rates are up 20.4 percent from the same week in 2012 when the rate was $2,922. Rates to the U.S. West Coast dropped 3.3 percent or $81 to $2,364 per FEU this week. The current rate is a 33.3 percent increase over the same week in 2012 when the rate was $1,774.
While rates in the westbound lanes to Europe have lost ground since the beginning of 2013, trans-Pacific rates are up despite recent weeks of decline. Rates to the U.S. East Coast are up 4.73 percent or $159 per FEU since the first week of January while rates to the U.S. West Coast are up 6.44 percent or $143 per FEU.
Richard Ward of ICAP said: “In the European markets, initial reports suggest that cargo demand will remain weak for the next two weeks, as softness from the Chinese festivities persists,” which will lead to a continued decline in the index next week. “Expectations though from the carrier’s side at least are that liftings for mid-March will improve, with Hanjin estimating vessel utilization of 90 percent.”