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CCFI Commentary Issue 40, 2017

  Freight Rate Slip with Demand Stable

  China export box transport market sees demand stable. However, in order to sustain market share, box liners decide to carry out freight rate decrease plan, leading freight rate in most routes falling and the comprehensive index slip. On Sep.29, Shanghai (Export) Containerized freight index issued by Shanghai Shipping Exchange quotes 715.97 points, falling by 2.7% from one week ago.

  Data issued by German Economy Information Institution shows that German IFO quotes 115.2 points in Sep, slip from one month before, which represents that Euro zone economy has a slower recovery. As a result, transport demand is dragged in the Europe route, where the average slot utilization rate hovers around 90%. For the insufficient cargo volume, freight rate declines further. On Sep.29, freight rate in the Shanghai-Europe route (covering seaborne surcharges) quotes USD714/TEU, down by 2.7% against one week ago. In the Mediterranean route, where market has a similar performance as that in the Europe route, the average slot utilization rate remains about 85%, with spot rate slip. On Sep.29, freight rate in the Shanghai-Mediterranean route (covering seaborne surcharges) has a week-on-week decrease of 2.4% to USD692/TEU.

  Economy in the U.S. performs well, which spurs the local residents and transport demand growing stably. Recently, cargo volumes increases rapidly, and demand/supply condition worsens. The average slot utilization rate sustains above 95%,with some even full-loaded. As freight rate stays at the relatively high level, booking rate slips slightly. On Sep.29, freight rates in the routes from Shanghai to USWC and USEC (covering seaborne surcharges) quote USD1414/FEU and USD1991/FEU, down by 4.7% and 5.4% from one week ago respectively.

  Transport demand keeps weak in the Persian Gulf route, which results in the whole market flat. Some box liners choose to limit the supply of the whole capacity. Nevertheless, capacity still short-supplied, the average slot utilization rate hovers between 75%-80%, leading spot rate declining compressively. On Sep.29, freight rate in the Shanghai-Persian Gulf route (covering seaborne surcharges) quotes USD366/TEU, a week-on-week slip of 2.7%.

  Transport demand has a stable growth in the Australia route, where demand/supply condition performs well and the average slot utilization rate sustains above 95%. After freight rate increasing continuously, the booking rate slips. On Sep.29, freight rate in the Shanghai-Australia route (covering seaborne surcharges) quotes USD708/TEU, down by 3.0% from one week ago.

  Transport demand keeps steady, the average slot utilization rate leaving off Shanghai Port between 90%-95%. Part of box liners carries out freight rate decrease plan to sustain market share, leading spot booking rate sliding. On Sep.29, freight rate in the Shanghai-South America route (covering seaborne surcharges) has a week-on-week slip of 2.1% to USD1846/TEU.

  Cargo volume and spot rate keep stable in the Japan route. On Sep.29, freight index in the China-Japan route quotes 673.84 points.

  

 
 
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