Markets/Trades

CMA CGM was reported to have fixed the 7,092 teu newbuilding TS DUBAI at a very strong $80,000 per day rate for 3 months, setting a new rate benchmark. Momentum picked up further last week as demand remains red hot while supply of prompt units of over 2,000 teu remain very tight. The sharp rise in freight rates will fuel the charter market in the next 8 weeks with no room for rates to drop. MSC has taken delivery of 2 more ships in the resale market last week although both ships were previously

With container equipment currently in short supply, the production of new dry container equipment has surged since the end of last year. New dry box production surged to 520,000 teu in April alone, 3 times higher than the 2023 monthly average with new factory production fully booked until the end of July. New box production expected to exceed 4m teu this year compared to 1.97m teu in 2023. The record production year was in 2021 when more than 6m teu of new boxes were delivered.

CoFIF freight futures to North Europe rallied sharply last week on the back of the sharp spot rate hikes driven by the current shortage of capacity on the trade. Effective capacity to North Europe is down 5.1% despite having 17.8% more in total vessel capacity deployed compared to a year ago, with the longer route via the Cape of Good Hope taking away almost 23% of the effective capacity. The SCFIS increased by 13.7% on 13 May to reach 2,512 with further increases expected over the coming weeks

The bullish container freight and charter markets continue to gain ground with carriers pushing for further rate hikes through May while demand for ships remain unabated. Over-capacity concerns are on the backburner with containership diversions to the Cape route effectively removing more than 7% of the total fleet. New tonnage requirements have shifted to the Mexico and Middle-East/Indian subcontinent markets, with 3 new services to Mexico launched in May alone by COSCO, CMA CGM and MSC while M

Containerships are still making transits on the Suez/Bab-el-Mandeb despite heightened risks following the collapse of ceasefire talks between Israel and Hamas and the escalation of the Houthi attacks on commercial shipping on the Red Sea which has widened to the Indian Ocean. Over 90 transits on the Bab-el-Mandeb has been recorded since 1 April 2024, mainly by smaller carriers operating in the Asia-Med and Baltic Sea routes, compared to over 700 voyages diverted to the Cape route in the same per

Asia-North Europe freight futures rallied over the Labour Day shortened trading week, with rates on the 2 main futures contracts (EC2406 and EC2408) trading higher on 30 Apr and 6 May. The 2 short dated contracts  rallied as the Middle East peace talks faltered with the 2 contracts accounting for nearly 80% of daily trading volumes, while the longer dated contracts for EC2412, EC2502 and the newly launched EC2504 were tactically sold off as trading hedges. Average daily volumes were unchanged b

The charter market went into overdrive last week, with fixture activity, rates and periods all rising in tandem. Carriers’ tonnage demand is still not fully covered despite the high level of new ship deliveries as the surging freight market is  supporting the rise in charter rates in all segments except for the 1,100 teu and smaller sizes. The composite charter index is up 10% YoY, with the larger sizes enjoying much higher increases. CMA CGM, Hapag-Lloyd, Maersk and SeaLead were the most activ

Asia-North Europe CoFIF freight futures retreated sharply on 29 April on fears that ceasefire talks taking place in Egypt this week could drag down freight rates before the end of the year. Contracts for October 2024 (EC2410) were most badly hit, dropping to 2,169 after reaching a peak of 2,765 last week. The latest EC2410 futures remain on par with the current SCFIS at 2,175 points, with EC2406 and EC2408 contracts still trading at a significant premium to the current SCFIS spot rate index at 2

The containership fleet capacity currently stands at 29.37m TEU and will reach 30m TEU by the end of June this year. Although the nominal fleet growth has reached 10% YoY, effective capacity on the 4 main East-West trades has grown by only 3% this year as the vessel diversions to the Cape route due to the Red Sea crisis has absorbed most of the new capacity. At a global level, effective capacity on all 33 inter-regional linehaul routes tracked by Linerlytica has shrunk by -4% YoY, with reduced

Speculative traders returned to the CoFIF market last week with average trading volumes doubling compared to the week before. Prices for longer dated contracts for June 2024 through February 2025 rallied. The EC2406 and EC2408 contracts rose above 2,500 compared to the latest SCFIS index at 2,135, implying an expected increase of over 17% from current rate levels. Market conviction on the May rate hikes have strengthened with several carriers pushing for higher FAK rates backed by improved vess