Demand Is Weak to Grow leading Rate Slip
China export box transport market is recovering, with transport demand growing slowly. Nevertheless, owing to the reuse of most capacity, the unbalanced supply/demand condition deteriorates, leading freight rates in most services tumbling and the comprehensive index slip further. On March 3, Shanghai Containerized Freight Index (SCFI) issued by Shanghai Shipping Exchange quotes 778.86 points, falling by 4.4% against one week ago.
Transport demand has a weak growth in the Europe route, where the oversupplied capacity is worsened and the average slot utilization rate remains around 90%.in the Mediterranean route, transport demand has a slower increase than that in the Europe route, and the average slot utilization rate is around 85%. For the insufficient cargo volume, freight rate increase plan faces depend, leading freight rate tumbles repeatedly. On March 3, freight rates in the routes from Shanghai to Europe and Mediterranean (covering seaborne surcharges) quote USD876/TEU and USD854/TEU, decreasing by 4.9% and 3.2% against one week ago respectively.
U.S. economy has a stable improvement, and transport demand has a firm recovery in the North America route. In terms of capacity, owing to the supply of capacity is increasing, the supply/demand condition tends to be unhealthy, leading the average slot utilization rates in the USWC and USEC routes remain around 85% and 90%. Most box liners choose to reduce freight rate to guarantee their market shares, and spot rate declines. On March 3, freight rates in the routes from Shanghai to USWC and USEC (covering seaborne surcharges) quote USD1496/FEU and USD2955/FEU, decreasing by 9.3% and 3.3% from one week ago respectively.
It is still in the traditional slack season in the Persian Gulf route, where the supply of capacity still overwhelms transport demand despite some box liners controlling it, and the average slot utilization rate is only 80% about. Spot rate continues to slip. On March 3, freight rate in the Shanghai-Persian Gulf route (covering seaborne surcharges) quotes USD503/TEU, falling by4.6% against one week ago.
Transport demand is weak during the slack season in the Australia/New Zealand route, where the average slot utilization rate remains around 80%. Spot rate declines continuously. On March 3, freight rate in the Shanghai-Australia/New Zealand route (covering seaborne surcharges) has a week-on-week decrease of 8.0% to USD469/TEU.
The unemployment rate is growing in Brazil, which drags down the Transport demand in the South America route, where the average slot utilization rate stands 80%-90%, with spot rate slip depressively. On March 3, freight rate in the Shanghai-South America route (covering seaborne surcharges) quotes USD1609/TEU, having a week-on-week decrease of 8.4%.