- US West Coast spot rates up 27% since late August.
- US East Coast rates rise 12% but spread with the West Coast narrows.
- Mediterranean spot rates have fallen by 8% since August.
It looks like average spot rates from the Far East to both Europe and North America have taken a bit of a dip compared to last week. This comes after a time when trades heading to the US were on the rise, while those going to Europe were seeing a sharper decline, reports Xeneta.
Transpacific Market Developments
Since the end of August, average spot freight rates to the US West Coast have jumped by 27.1%, and rates to the US East Coast have increased by 11.8%. Right now, the difference between the two coasts is sitting at USD 868 per FEU, which is quite a shift from the more usual USD 1,027 per FEU noted on August 31. Analysts are predicting that this discrepancy will even out as the markets find their footing.
Europe-Bound Spot Rates Under Pressure
Since the end of August, average spot freight rates to the Mediterranean have dropped by 8.1%, while rates to Northern Europe have decreased by 12.9%. Compared to last week, rates have fallen by 1.7% for the Mediterranean and 2.2% for Northern Europe. Spot market rates in these areas have been on a steady decline since mid-June (for the Mediterranean) and early July (for Northern Europe).
Transatlantic Trade Remains Stable
When it comes to Transatlantic trade, average spot rates have remained pretty stable, with a slight dip of just USD 3 per FEU (-0.2%) from last week and a decrease of USD 50 per FEU (-2.6%) since August 31.
Analyst Insight – Transpacific
Peter Sand, Xeneta Chief Analyst: “Carriers are swapping out China-built vessels on services into the US ahead of USTR port fees coming into force next month. This could be one of the factors behind increasing spot rates on Transpacific trades.
“Swapping out China-built ships may not result in lower capacity or blanked sailings, but it will cause disruption with the potential to impact rate development.
“For example, Gemini is swapping out a total of 60 000 TEU across six China-built vessels on the US2 service, which calls at both the US East Coast and US West Coast. It’s clear this is a concerted effort to minimize China-built TEU on these trades.”
Analyst Insight – Far East to North Europe
Peter Sand, Xeneta Chief Analyst: “On 1 August, average spot rates on trades from Far East to North Europe and Mediterranean were completely aligned, but that spread has now increased to USD 500 per FEU.
“This is a fascinating story because the spread is caused by North Europe falling harder while Mediterranean is holding firmer on both short and long term markets. One factor is found in stronger demand at ports in the Western Mediterranean, which is helping to hold spot rates up in comparison to North Europe.”
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Source: Xeneta
