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Weekly Report on China’s Export Container Market(10.19–10.25)

  Freight rates rebounded due to recovering shipping demand

  In this week, the shipping demand for China's export container shipping market generally performed well. The cargo volume continued to rise after the "National Day" holiday. Backed by the improved market fundamentals, spot market rate increased on most service routes. On October 25th, Shanghai (Export) Containerized Freight Index (SCFI) issued by Shanghai Shipping Exchange (SSE) quoted 774.27 points, up by 3.7% compared with previous week.

  In the Europe route, inspired by the Christmas’ cargo flow, cargo volume kept increasing after the long holiday. Some carriers implemented capacity contracting operations as planned. This week, the average slot utilization rate ex Shanghai Port was between 85 and 90%, and some of the departed vessels even increased above 95%. Spot market rate increased by some carriers’ rate hiking plan. On October 25th, freight rate in the route from Shanghai to Europe (including seaborne related surcharges) was quoted USD594/TEU, up by 2.4% from one week ago. In the Mediterranean route, the market situation was similar to that in Europe. The average slot utilization rate ex Shanghai Port was about 90%, and some of the vessels were fully loaded. Most carriers took keep-and-watch policy and spot market rate slightly dropped. On October 25th, freight rate in the route from Shanghai to Mediterranean (including seaborne related surcharges) was quoted USD710/TEU, down by 0.7% from one week ago.

  In the North America route, the cargo volume gradually increased after the holiday. In addition, affected by the capacity contracting operations by the alliances, the scale of capacity supply in the fourth quarter was expected to decline. Supported by the improved market fundamentals, the average slot utilization rate ex Shanghai Port on the USWC and USEC routes in this week was over 95%, and many vessels departed with full loads. Even the relationship between supply and demand became better, most carriers kept their quotations without change. The spot market rate slightly waved. On October 25th, freight rates in the routes from Shanghai to USWC and USEC (including seaborne related surcharges) quoted USD1361/FEU and USD2411/FEU, slightly down by 0.5% and 1.6% respectively compared to last week.

  In the Persian Gulf route, the shipping demand increased significantly after the holiday. The carriers continued their operations on capacity contracting to keep the balance of supply and demand. This week, the average slot utilization rate ex Shanghai Port has risen to over 95%, and some of the vessels were fully loaded and departed. Backed by this, most carriers raised their booking rates from next month, and the spot market freight rates soared again. On October 25th, freight rate in the Shanghai to Persian Gulf route (contains seaborne related surcharges) quoted USD786/TEU, significantly rocketed up by22.4% from previous week.

  In the Australia/New Zealand route, the market was rather active and the performance of transportation demand was stronger. The cargo volume was still at a high level. This week, the average slot utilization rate ex Shanghai Port was above 95%, and most vessels were fully loaded. Due to the strong market fundamentals, some carriers raised their quotations again, and the spot market rate kept its upturning trend. On October 25th, freight rate in the Shanghai to Australia/New Zealand route (contains seaborne related surcharges) quoted USD1164/TEU, up by 3.8% from one week ago.

  In the South America route, the cargo volume was generally stable as well as the supply-and-demand relationship. This week, the average slot utilization rate ex Shanghai Port was above 95% with some vessels fully loaded. Some carriers implemented their new round of GRI which was to be effective from next month. The spot market rate increased accordingly. On October 25th, freight rate in the Shanghai to South America route (contains seaborne related surcharges) quoted USD1965/TEU, up by 9.3% compared to last week.

  In the Japan route, cargo volume was stable, and the market rate slightly declined. On October 25th, freight index in the China to Japan route quoted 726.91 points, down by 0.5% from previous week.

 
 
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