The downward trend in freight rates for larger trade lanes originating from India continues, primarily due to persistent head-haul volume challenges, reports the Loadstar.
Despite sporadic disruptions, such as vessel availability issues faced by Singapore-based ONE, carriers have struggled to maintain high rates.
Freight forwarders anticipate further softening of rates
Spot rates for the India-US east coast trade have plummeted to below $3,000 per TEU from peak levels of over $10,000 just three months ago. Similarly, rates on India-Europe routes have halved, dropping to approximately $2,000 per TEU from $5,000 in August.
While the upcoming Gemini alliance between Maersk and Hapag-Lloyd is expected to impact market dynamics, freight forwarders anticipate further softening of rates for US and Europe-bound shipments until at least December.
A silver lining for carriers lies in the India-Africa trade, which has seen a surge in demand due to recent government measures to reduce export taxes on agricultural products. This has led to a significant increase in ocean rates for this trade lane.
However, the overall export outlook for India remains challenging. Persistent global trade disruptions and volatile commodity prices have contributed to a decline in export values. Exporters are urging the government to provide more trade finance options to address these challenges and enhance India’s competitiveness in the global market.
In addition to trade concerns, India is currently preparing for the landfall of cyclone Dana on its east coast. The cyclone is expected to impact both India and Bangladesh.
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Source: The Loadstar
