Carriers cut rates to stock cargoes
In this week, the China's export container shipping market demand showed signs of decline. To stock more cargoes for voyages during Chinese “National Day” holiday period, some carriers cut their booking rates. Thus rates dropped on most shipping routes and the comprehensive index fell accordingly. On September 28th, Shanghai (Export) Containerized Freight Index (SCFI) issued by Shanghai Shipping Exchange (SSE) quoted 870.58 points, down by 2.2% from previous week.
In the Europe route, as market was close to the off-season, transportation demand declined in this week. Although there were certain pre-holiday rush cargoes before the “National Day” holiday, it didn’t meet the expectations. This week, the average slot utilization rate ex Shanghai to the Europe route was between 85% and 90%. By the action of carrier’s rate cutting policy in exchange of more loads, the spot market rate fell in certain degree. On September 28th, freight rate in the route from Shanghai to Europe (including seaborne related surcharges) quoted USD735/TEU, down by 4.0% from one week ago. In the Mediterranean route, the cargo volume performed weaker than that on Europe route. The average slot utilization rate ex Shanghai was between 80-90%. Most of the carriers lowered their booking rate to compete for more cargoes. On September 28th, freight rate in the route from Shanghai to Mediterranean (including seaborne related surcharges) quoted USD767/TEU, down by 4.6% from last week ago.
In the USWC route, as Sino-US trade disputes intensified, some tariff policies came into force, which suppressed the trend of increasing transportation demand. However, it further stimulated the cargo owner’s pace of cargo delivery schedule and helped the total shipping demand maintained at high level. This week, the average slot utilization rate ex Shanghai kept above 95% with some of them departing with full loads. Based on the healthy fundamentals, most carriers maintained their tariff rate without adjustment. On September 28th, freight rates in the routes from Shanghai to USWC (including seaborne related surcharges) quoted USD2332/FEU, marginally down by0.5% compared to last week. In the USEC route, as some carrier deployed additional capacity into the market, spot rate dropped under the pressure of surplus capacity. On September 28th, freight rates in the routes from Shanghai to USEC (including seaborne related surcharges) quoted USD3319/FEU, down by 5.2% compared to last week.
In the Persian Gulf route, shipping demand fluctuated as the status of political instability. Even carriers made efforts on contrasting the capacity, the supply-and-demand relationship had not been improved. This week, the average slot utilization rate ex Shanghai was about 85%. Affected by the soft fundamentals, spot rate continued to fall. On September 28th, freight rate in the Shanghai to Persian Gulf route (including seaborne related surcharges) quoted USD354/TEU, down by 3.0% from previous week.
In the Australia/New Zealand route, the market transportation demand was weak just during pre-holiday period. Even carriers took measure to cut the capacity supply, the average slot utilization rate ex Shanghai was between 85% ~ 90%. Most carriers maintained price reduction strategy to stretch for cargoes. The spot market freight rate fell accordingly. On September 28th, freight rate in the Shanghai to Australia/New Zealand route (including seaborne related surcharges) quoted USD532/TEU, down by 1.1% against one week ago.
In the South America route, influenced by the unstable economic situation in destination area, the shipping demand was seen decline in recent period. This week, the average slot utilization rate ex Shanghai was about 95%. As most carriers cut their booking rates to compete for stock cargoes, spot rate continued to dive. On September 28th, freight rate in the Shanghai-South America route (including seaborne related surcharges) quoted USD976/TEU, greatly down by 11.1% compared to last week.
In the Japan route, shipping demand maintained stable, and market rate waved in small range. On September 28th, freight index in the China to Japan route quoted 718.12 points, down by 1.5% compared with last week.