News Content
Rates fall in February on Chinese New Year, and overcapacity: Drewry
FREIGHT rates on the East-West trades plummeted in February, ending three straight months of price hikes, as indicated by a 12 per cent decline in Drewry's Asia-Europe Westbound Freight Rate Index to US$2,992 per FEU.
Weekly data from the World Container Index also shows that the pricing erosion has continued into March.
Spot rates on the transpacific shed some gains as well with Drewry's Transpacific Eastbound Freight Rate Index easing three per cent over January to $2,669 per FEU.
As a consequence, Drewry's East-West Freight Rate Index, a weighted average of spot rates across the transpacific, transatlantic and Asia-Europe/Mediterranean trades, dropped eight per cent in February to average $2,255 per FEU.
"The GRIs lined up on both the Asia-Europe and the transpacific trades will struggle to lift rates to sustainable levels unless carriers take drastic measures to tighten capacity while accommodating the ultra-large vessels scheduled to join these trades this year," said senior manager of supply chain research at Drewry, Simon Heaney.
"Deliveries of new ultra-large ships will only add to the existing overcapacity and lead to more cascading, putting rates under further pressure.
"The policy of skipped sailings and frequent GRIs can be expected to continue, but any gains from these tactics will only bring temporary relief to carriers," said Mr Heaney.
Weekly data from the World Container Index also shows that the pricing erosion has continued into March.
Spot rates on the transpacific shed some gains as well with Drewry's Transpacific Eastbound Freight Rate Index easing three per cent over January to $2,669 per FEU.
As a consequence, Drewry's East-West Freight Rate Index, a weighted average of spot rates across the transpacific, transatlantic and Asia-Europe/Mediterranean trades, dropped eight per cent in February to average $2,255 per FEU.
"The GRIs lined up on both the Asia-Europe and the transpacific trades will struggle to lift rates to sustainable levels unless carriers take drastic measures to tighten capacity while accommodating the ultra-large vessels scheduled to join these trades this year," said senior manager of supply chain research at Drewry, Simon Heaney.
"Deliveries of new ultra-large ships will only add to the existing overcapacity and lead to more cascading, putting rates under further pressure.
"The policy of skipped sailings and frequent GRIs can be expected to continue, but any gains from these tactics will only bring temporary relief to carriers," said Mr Heaney.
Latest News
- For the first time, tianjin Port realized the whole process of dock operati...
- From January to August, piracy incidents in Asia increased by 38%!The situa...
- Quasi-conference TSA closes as role redundant in mega merger world
- Singapore says TPP, born again as CPTPP, is now headed for adoption
- Antwerp posts 5th record year with boxes up 4.3pc to 10 million TEU
- Savannah lifts record 4 million TEU in '17 as it deepens port
