CCFI Commentary Issue 41, 2017


  Demand Keeps Stable but Rate Rising

  China export box transport demand keeps stable as a whole. Transport markets in the Europe, Mediterranean and North America routes perform flat, with freight rate declining. However, freight rates in the Australia/New Zealand and South America routes have a large increase, spurring the comprehensive index growing slightly. On Oct.13, Shanghai Containerized Freight Index (SCFI) issued by Shanghai Shipping Exchange (SSE) quotes 724.93points, up by 1.3% against one week ago.

  Market volume declines slightly in the European routes, where the average slot utilization rate leaving off Shanghai Port is about 90%. In order to maintain market share, box carriers lower their booking rates, leading spot rate decreasing. On Oct.13, freight rate in Shanghai-European route (covering seaborne surcharges) quotes USD686 /TEU, a decrease of 3.9% over one previous period. The average slot utilization rate is about 80%~85% in the Mediterranean routes, where  spot rate continues to decline. On Oct.13, Shanghai- Mediterranean route (covering seaborne surcharges) has a week-on-week slip of 5.8% to USD652 /TEU.

  In the North American routes, as local consumer confidence fell, transport demand grows slowly. The average space utilization rate leaving off Shanghai Port this week is around 95%.Despite capacity still limited, some box liners reduce booking rate, leading spot rate slip. On Oct.13, freight rates in the routes from Shanghai to USWC and USEC (covering seaborne surcharges) quote USD1367/FEU and USD1801/FEU, falling by 3.3% and 9.5% from one week ago respectively.

  In the Persian Gulf route, transport demand show signs of stabilizing. Simultaneously, with the help of capacity control measures, the average slot utilization rate leaving off Shanghai Port recovers to beyond 90%, the overall supply and demand relations gradually improves. Many box liners try to raise their shipping rates, with spot rate rebounding. On Oct.13, freight rate in the Shanghai-Persian Gulf route (covering seaborne surcharges) quotes USD410/TEU, up by 12.0% against one previous week.

  Transport demand performs strongly in the Australia route, where the average slot utilization rate sustains above 95%, with some even 100%. As the good performance of demand/supply condition, most box liners hike freight rate, leading spot rate increasing. On Oct.13, freight rate in the Shanghai-Australia route (covering seaborne surcharges) quotes USD1020/TEU, growing by 44.1% from one week ago.

  Transport demand is hot in the South America route, where demand/supply condition keeps well. The average slot utilization rate sustains above 95%, with some even full loaded. Most box liners announce to carry out freight rate increase plan forcefully, with spot rate growing largely. On Oct.13, freight rate in the Shanghai-South America route (covering seaborne surcharges) quotes USD2582/TEU, surging by 39.9% from one week ago.

  Cargo volume keeps stable in the Japan route, where spot rate fluctuates. On Oct.13, freight index in the China-Japan route quotes 660.0 points.

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