Finally! The freight rate stopped falling after 43 weeks, and the freight rate of the European line rose by 10%!-GLA family GLA Global Logistics Alliance Logistics network Global Logistics network

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Finally! The freight rate stopped falling after 43 weeks, and the freight rate of the European line rose by 10%!

Time:2023-01-11 Publisher:Kevin Num:3094

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After the latest issue of the Shanghai Container Freight Index (SCFI) saw a slight increase, the Dulurie WCI finally rose to US $2135 in 2023, up 0.7%. This is the first time that the index has risen after falling for 43 consecutive weeks since February 2022.

It is worth mentioning that several major container freight indexes, including SCFI, WCI and FBX, have seen freight rates rise on European routes, with WCI up 10% and FBX up 14%.

The latest WCI composite freight index is $2135 per 40 foot container, 79% lower than the peak of $10377 reached in September 2021, and 77% lower than the same period in 2021.

It is 21% lower than the 10-year average of US $2694, indicating that the freight rate has returned to the normal level, but it is still 50% higher than the average freight rate of US $1420 in 2019 before the epidemic.

Although the freight rates of other trade routes continued to decline, the WCI index was driven by the freight rates of the Shanghai-Roterdam trade route (Asia-Europe route), which rose by $168 to $1874/FEU, up 10%; The freight rate between Shanghai and Genoa (Mediterranean route) increased by $47 to $2926/FEU, or 2%.

The freight rates of Shanghai - New York and Shanghai - Los Angeles dropped by 3% and 1% respectively. Drury expects that the freight rate will decline slightly week by week in the coming weeks.

Although the market expects that the freight rate will decline before the middle of 2023, most of the decline will occur around the Chinese Spring Festival. However, inflation in Europe and interest rate hikes in the United States may be the key drivers of trade.

The Shanghai Container Freight Index (SCFI) released the freight index for the last time in 2022, breaking the downward trend of seven consecutive months. The Baltic Freight Index (FBX) also recorded a rise of more than 6% in its latest weekly report. The freight rate from China to Europe has increased by 14%, which indicates that there is some cushion for the decline of freight rate.

It must also be pointed out that compared with the average cancellation level of 12-13% in the past few weeks, the number of recently suspended flights has reached a record high (17%). This may help cushion the further fall of freight rates.