CCFI Commentary Issue 11, 2017

  Demand and Rate Slip

  China export box transport market slips, which sees transport demand tend to decline and demand/supply condition shrink. The comprehensive index slips slightly. On March 10, Shanghai Containerized Freight Index (SCFI) issued by Shanghai Shipping Exchange quotes 761.15 points, falling by 2.3% against one week ago.

  The slower recovery European economy drags down the growth of resident’s consumption and transport demand. In the Europe route, cargo volume begins to slip, leading demand/supply condition worsens, and the average slot utilization rate declines to about 85%, leading spot rate declining further. On March 10, freight rate in the Shanghai-Europe route (covering seaborne surcharges) quotes USD859/TEU, a slip of 1.9% against one week ago. In the Mediterranean route, cargo volume slips slightly, and the average slot utilization rate tumbles to around 80%, with spot rate decreasing. On March 10, freight rate in the Shanghai-Mediterranean route (covering seaborne surcharges) quotes USD838/TEU, a week-on-week slip of 1.9%.

  U.S. PMI quotes 54.1, a slip of 1.5, but shows U.S. economy is improving, which boosts the transport demand in the North America route. Transport demand tends to slip and demand/supply condition tends to tightened. Both the average slot utilization rates in the USWC and USEC routes keep around 90%, but booking rate decreases depressively. On March 10, freight rates in the routes from Shanghai to USWC and USEC (covering seaborne surcharges) quote USD1424/FEU and USD2887FEU,falling by 4.8%、2.3% from one week ago respectively.

  Cargo volume stops increasing in the Persian Gulf route, where the average slot utilization rate decreases to below 80% for a large number of capacities recovering work. Spot rate slips continuously. On March 10, freight rate in the Shanghai-Persian Gulf route (covering seaborne surcharges) quotes USD477/TEU, a week-on-week tumble of 5.2%.

  Transport demand is on the flat condition in the Australia/New Zealand route, where some box liners limit capacity supply to sustain the demand/supply condition and the average slot utilization rate sustains around 85%. Spot rate continues to tumble. On March 10, freight rate in the Shanghai-Australia/New Zealand route (covering seaborne surcharges) quotes USD460/TEU, falling by 1.9% from one week ago.

  Transport demand stands on the flat condition in the South America route, where supply/demand keeps on the relatively stable condition and the average slot utilization rate remains around 85%. Main box liners see freight rates ups and downs, but keep firmed in whole. On March 10, freight rate in the Shanghai-South America route (covering seaborne surcharges) quotes USD1613/TEU, almost unchanged from one week ago.

  Cargo volume tumbles in the Japan route, where spot rate keeps stable. On March 10, freight index in the China-Japan route quotes 657.52 points.

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