Transatlantic Rates Maintain Status Quo Amidst Tumbling Chinese Export Rates

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Credit: frank mckenna/ unsplash

Navigating the container spot rate market has become a minefield for shipper procurement managers under pressure from bosses to get the best deal in the market.

Asia-Europe Trade Lane

On the Asia-North Europe trade lane, the published spot indices all agree rates are falling by double-digit values week on week, but there is a considerable difference in the readings. For example, Drewry’s WCI North Europe component fell 14% this week, to $1,686 per 40ft. 

Meanwhile FAK inclusive rate offers from alliance carriers this week, down to $1,300 per 40ft, from all Chinese ports to all UK and north continental ports, and valid until 31 December. The validity of these extremely low rate offers is questionable, however, as it appears some unscrupulous forwarders are fishing for new business based on anticipated rate reductions by carriers.

One shipper  said his company was not taking these ‘offers’ seriously, as there was no guarantee of space. He added: “We will only book against an e-mail offer from a carrier that is quoting our contract number.”

The Transpacific

Elsewhere, on the transpacific, according to the spot indices, the pace of the rate decline has slowed for Asia to the US west coast, with the WCI down 2% on the week to $1,997 per 40ft, the XSI declining by 5% to $1,519 and the FBX losing 1.6% to $1,403. On the Atlantic coast, however, both the WCI and the FBX recorded 9% falls in their Asia-US east coast components, to $3,993 and $3,368 per 40ft, respectively.

For ocean carriers, the sole remaining jewel in the crown, in terms of demand and elevated spot rates, is the transatlantic trade lane, where a combination of a strong dollar and US retailers opting to source more product from Europe rather than China, is keeping the market buoyant.

The strength of the market has prompted carriers to upgrade their tonnage on the route and has seen weekly capacity boosted by new entrants to the trade. 

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Source: Theloadstar

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