Spot Rates Hit New High In The European Region

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  • Spot rates to the west coast jumped to a record $3,758 per 40ft, 129% higher than at the beginning of the year.
  • Spot rates to the east coast ports increased to the market rate of $4,538, 72% greater than a year ago.
  • Meanwhile, the European spot market was found to be less frantic, with SCFI reading for North Europe edging up to $1,042 per teu.

The China to US components of today’s Shanghai Containerized Freight Index (SCFI) recorded another big jump in spot rates, after the implementation by carriers of a sixth consecutive successful GRI on 1 September, reports The Loadstar.

Jump in spot rates

Spot rates to the west coast jumped a further $119 on the week, to a record $3,758 per 40ft, a staggering 129% higher than at the beginning of the year and 140% above the rate of 12 months ago.

Not to be left out of the transpacific freight rate bull run, spot rates to the east coast ports increased by $330 per 40ft this week, to take the market rate to $4,538, 72% above the level of a year ago.

Deploying extra loaders on the route

Carriers are deploying extra loaders on the route, including THE Alliance, which said yesterday it would put on two additional sailings this month “in view of the high market demand”. 

Jon Monroe, president of Jon Monroe Consulting, says BCOs with space allocation problems are turning to NVOCCs in an attempt to solve their supply chain issues, but even the biggest non-operating carriers are experiencing rollovers and seeing big rate hikes.

“NVOCCs are both beneficiaries and victims of Covid-19,” said Mr Monroe. 

“On the one hand, they struggle to obtain bookings and manage space with their contracted carriers, and at the last minute are faced with rate hikes.

On the other hand, those that have close relationships with their carriers at the load port can sometimes get additional space.”

European spot market

Meanwhile, the spot market for Europe was much less frantic, this week’s SCFI reading for North Europe edging up just $13, to $1,042 per teu and rates to Mediterranean ports increasing $23 per teu, to $1,082.

“We expect the situation and market strength to last at least well into October if not beyond,” said Mr Holst-Mikkelsen, head of ocean freight EMEA at Flexport.

“We expect this year to be different from recent years, where factories generally ramp up slowly after the Chinese Golden Week holiday. With a very strong order pipeline and backlog, factories are going to focus on getting back up to capacity at a very fast pace.”

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Source: The Loadstar

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