The contract freight rates for ocean container shipping have fallen by 9.5% over the month and by 58% over the year and reached a two-year low in June, according to the current values of the XSI reported by the Xeneta Norwegian Monitoring Service.
The contract rates for shipping imports to Europe dropped last month by 12% compared to a month earlier, and by 53% over the year. The average freight rates under long-term contracts for shipping imports in the USA decreased by 2.9% in July.
Xeneta notes that this dynamic is alarming in the context of the dramatically accelerated rate of growth in the capacity of the container ship fleet. According to Alphaliner, 36 new vessels with a capacity of over 300,000 TEUs joined the global fleet in June, which is a new all-time record. The peak of new deliveries is expected in the third quarter, and in August the influx of new tonnage will exceed 350,000 TEUs.
Following Maersk, almost all key liner operators have announced an increase up to USD 1,900 in the cost of shipping a container from Asia to Northern European ports starting in August. This is approximately 46%, or USD 600, more than the current spot market rate level announced by Drewry WCI.
Similar surcharges are being introduced by operators on routes from Asia to Mediterranean ports.
At the same time, the Drewry WCI container spot rate subindex for the Shanghai–Rotterdam route is at a level slightly below USD 1,300 per FEU, while the subindex for routes from Asia to Mediterranean ports has fallen to USD 1,893 per FEU this week.
According to the expert survey by The Loadstar, market participants are doubtful whether carriers will be able to stop the decline in rates on the European direction, as the demand in Europe remains low, and in the meantime, carriers are actively increasing fleet capacity by putting new vessels delivered from shipyards into service.