Container freight rates on many major trade routes have remained firm as operators manage capacity to avoid a price-damaging surplus, Drewry’s Container Insight reports.
According to the consultancy firm, Drewry’s Global Freight Rate index was 37% higher during the January-May period than in the corresponding period in 2016.
This was thanks to the scrapping of older ships, idling and mothballing new constructions and deferring deliveries of new ships.
Some existing ships have also been temporarily taken out of system, reducing availability on many routes.
In particular, the Europe-Asia route has witnessed major rate increases and, against expectations, the higher rates have been maintained.
For example, rates on the Rotterdam-Shanghai route were assessed at $1,437 for a 40ft container on June 19, a rise of 136% year on year.
In addition, Drewry’s East-West Freight Rate index was up by 44% after five months of this year, seven points above the rise in the Global Freight Rate index.
Grain market impact
Meanwhile, higher bulk shipping rates were evident in grain markets this in a purchase by Egypt’s Gasc grain authority of seven cargos of wheat, totalling 410,000 tonnes, from Romania and, in the main, Russia.
Gasc paid on average $13.83 a tonne shipping on the six cargos of Russian grain.
A year ago, it was paying around $9 a tonne for freight to Egypt from Russia.
The $13.00 a tonne that Gasc paid for shipping the Romanian cargo was nearly twice the $6.66 a tonne it paid for some supplies on the same route in July last year.
Source: AgrimoneyPrevious Next