Spot market rate rebounded as carriers to charge new Low Sulfur Surcharges

　　In this week, the Chinese export container shipping market has remained stable. As most carriers began to charge new Low sulfur Surcharges as per rules by IMO 2020, spot market rate increased on most service routes and composite index rebounded significantly. On November 29th, Shanghai (Export) Containerized Freight Index (SCFI) issued by Shanghai Shipping Exchange (SSE) quoted 819.63 points, up by 7.1% compared with previous week.

　　In the Europe route, according to data released by Markit, the Euro Zone initial value of manufacturing PMI in November was 46.6, an increase from the previous value of 45.9, the highest level in three months. As the traditional peak season was close to the end, the cargo volume level has started to decline. Carriers still implemented capacity controlling measures to keep the balance of supply and demand. This week, the average slot utilization rate ex Shanghai Port has stabilized about 90%. Although the market fundamentals were soft, the spot market rate was pushed high by the levy of new Low Sulfur Surcharges (LSS). On November 29th, freight rate in the route from Shanghai to Europe (including seaborne related surcharges) was quoted USD766/TEU, up by 9.1% from one week ago. In the Mediterranean route, the market condition was similar to that of European routes. This week, the average slot utilization rate ex Shanghai Port was around 80%. The booking rate increased by newly added LSS. On November 29th, freight rate in the route from Shanghai to Mediterranean (including seaborne related surcharges) was quoted USD730/TEU, up by 6.0% from one week ago.

　　In the North America route, according to data released by the US Department of Commerce, US retail sales rose 0.3% in October from the previous month. Since it was close to the end of the peak transportation season, there has been a decline in transportation demand. Although some carriers still put efforts to keep the balance between supply and demand by contracting scale of capacity supply, the overall market fundamentals were soft. This week, the average slot utilization rate ex Shanghai Port to USWC and USEC has remained above 90%. And by the easing of Sino-US trade disputes which brought positive outlook to the market, some carriers have pushed up freight rates from the beginning of next month. On November 29th, freight rates in the routes from Shanghai to USWC and USEC (including seaborne related surcharges) quoted USD1405/FEU and USD2684/FEU, hiked by 14.3% and 19.0% respectively compared to last week.

　　In the Persian Gulf route, transportation demand increased steadily in recent period, and capacity controlling policies from carriers were also extended. The relationship between supply and demand kept in healthy level. This week, the average slot utilization rate ex Shanghai Port has remained above 95%. With the support from strong demand, the spot market rate continued to rise. On November 29th, freight rate in the Shanghai to Persian Gulf route (contains seaborne related surcharges) quoted USD835/TEU, up by 8.2% from previous week.

　　In the Australia/New Zealand route, transportation demand continued to fall when the peak season passed away. Some carriers took capacity control measures to maintain the balance between supply and demand. This week, the average slot utilization rate ex Shanghai Port has remained at around 95%. Spot market rate continued to fall back from previous high level. On November 29th, freight rate in the Shanghai to Australia/New Zealand route (contains seaborne related surcharges) quoted USD816/TEU, sharply down by 11.9% from one week ago.

　　In the South America route, the overall transportation demand increased slightly. Carriers continued to contract their total scale of capacity deployment, and the relationship between supply and demand almost stayed at healthy level. This week, the average slot utilization rate ex Shanghai Port rose to over 95%. Thanks to the strong market fundamentals, the spot market rate increased. On November 29th, freight rate in the Shanghai to South America route (contains seaborne related surcharges) quoted USD1667TEU, up by 2.5% compared to last week.

　　In the Japan route, cargo volume was stable. The market rate slightly waved. On November 29th, freight index in the China to Japan route quoted 715.57 points, down by 2.0% from previous week.