CCFI Commentary Issue 9, 2018

  Demand/supply Condition Stable with Rate Slip

  China export box transport market sees demand weak, but the whole demand/supply condition keeps stable because box liners limit the supply of capacity. Fright rates in most routes slip slightly, and the comprehensive index declines. On Feb.23, Shanghai (Export) Containerized Freight Index (SCFI) issued by Shanghai Shipping Exchange (SSE) quotes 854.19 points, down by 1.5% from last week.

  In the Europe route, as part of box liners takes measures to limit capacity supply, demand/supply condition keeps well, and the average slot utilization rate sustains 95%-100%, with some even full-loaded. Most box liners sustains freight rate, and some even hike spot rate slightly. On Feb.23, freight rate in the Shanghai-Europe route (covering seaborne surcharges) quotes USD916/TEU, up by 1.6% from one week ago. In the Mediterranean route, the average slot utilization rate is 85%-90%. Spot rate almost in line with one week ago. On Feb.23, freight rate in the Shanghai-Mediterranean route (covering seaborne surcharges) quotes USD797/TEU, down by 0.8% from last week.

  In the North America route, benefited by the good performance of employment rate, local consumption demand and the whole transport demand keep stable. Although the average slot utilization rates in the USWC and USEC routes are around 95%, part of box liners start to reduce freight rate, causing spot rate climbing. On Feb.23, freight rates in the routes from Shanghai to USWC and USEC (covering seaborne surcharges) quote USD1412/FEU and USD2708/FEU, down by 4.9% and 2.1% from one week ago respectively.

  Transport demand is weak in the Persian Gulf route, where demand/supply condition worsens and the average slot utilization rate keeps 80%-85%. For the excess supply of capacity, spot rate declines. On Feb.23, freight rate in the Shanghai-Persian Gulf route (covering seaborne surcharges) quotes USD571/TEU, falling by 1.4% against one week ago.

  In the Australia/ New Zealand route, the whole transport demand slips, which hits demand/supply condition and leads part of box liners reduce freight rate to guarantee their market shares. On Feb.23, freight rate in the Shanghai- Australia/ New Zealand route (covering seaborne surcharges) has a week-on-week decline of 1.9% to USD1263/TEU.

  Demand/supply condition keeps stable in the South America route, where the average slot utilization rate stays around 95%. Most box liners hold stand-by attitude and sustain freight rate at the present level. On Feb.23, freight rate in the Shanghai-South America route (covering seaborne surcharges) quotes USD2539/TEU, down by 0.8% from one week ago.

  Cargo volume and spot rate slip in the Japan route. On Feb.23, freight index in the China-Japan route quotes 724.54 points.

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