The last week of April failed to lift rates, despite the impending contract rate increases on the transpacific routes with higher rates taking effect from 1 May. Asia to US West Coast contracts will rise to an average of $9,000/feu while US East Coast contracts will increase to $11,000/feu which is higher than current spot rates of $7,800 and $10,600 respectively.
With most of the Asian markets closed for the Labour Day holidays and Eid holidays, there will be limited activity in the week ahead with spot freight rates to remain under pressure. There was, however, some encouraging signs of a possible rebound in the weeks ahead as cargo volumes are expected to recover gradually as Chinese lockdown measures are eased with reports of rising rates on the Latin American routes leading the way for other routes to follow.
Port congestion, delays and bottlenecks have forced carriers to cancel scheduled sailings on key East-West routes in the last 12 months. Despite this, average capacity on the 4 main trunk routes have remained largely stable, with carriers’ blanked sailing programs doing little to remove excess capacity on these routes in the last 3 months. Spot freight rates have suffered 16 consecutive weekly declines since January 2022 , based on the composite SCFI assessment.
Weekly Market Pulse: US$1,500 per year