FBX Index Soars In May, Forward Curves Reflect Upward Trend

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  • The Freightos Baltic Index (FBX) experienced a significant surge in May across all major routes, with spot rates reaching their highest level in 20 months.
  • This upward trend is expected to continue in the near future, as reflected in the rising forward curves.

Key Findings

  • The FBX index climbed from $2,409 to $3,508 in May, a $1,099 increase per FEU.
  • FBX01 (China/East Asia to North America West Coast) saw a 63% increase in spot rates, reaching $5,027 by month’s end.
  • Forward curves for all routes mirrored the spot rate increases, indicating continued upward pressure.
  • The surge is attributed to Red Sea diversions causing container shortages and prompting earlier bookings.
  • Carriers prioritized high-paying spot cargo over contracted customers.

Trading Strategy Considerations

  • Spreading backhaul routes (FBX02, FBX12) against main routes (FBX11, FBX13) could offer value.
  • Selling main routes in deferred months and Cal25 might be advantageous due to expected new capacity later in 2024.

Market Outlook

Volatility and uncertainty remain high, requiring careful consideration when developing pricing strategies. Overall, the FBX data suggests a robust container shipping market in the short term. However, shippers should be cautious and adapt their strategies based on the evolving market conditions.

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Source: Baltic Exchange