CONTAINER SHIPPING RATES CONTINUE TO DECLINE
Container shipping rates on major trade routes are experiencing a significant downward trend. According to the latest data from Drewry's World Container Index, the average rate for transporting a forty-foot container from Shanghai to Rotterdam fell by nearly $400 this week, an 8% decrease. The rate now stands at $4,375 per container, 1% lower than at the same time last year. This marks a notable shift, as just a week ago, rates were still 33% higher compared to the same period in 2024.
The decline is exacerbated by a drop in vessel utilization, as noted by analyst Linerlytica. Current shipping capacity exceeds levels seen over the past twelve months, while available cargo volumes are insufficient to fill this capacity efficiently. As a result, container carriers are lowering rates further to attract shipments, a trend expected to continue in the coming weeks. The annual impact of the Chinese New Year is also contributing to the rate decline. This year, the holiday begins on January 29, and the traditional two weeks of economic inactivity in China lead to a temporary drop in the supply of container cargo. In anticipation, carriers have already implemented several blank sailing.
In contrast to the declining rates on the Asia-Europe route, Drewry reports significant increases in rates for shipments from Shanghai to the United States. These surges are partly driven by shippers expediting cargo ahead of potential higher import tariffs, as Donald Trump prepares to take office as President of the United States. Drewry expects rates on the Transpacific route to continue rising in the weeks ahead.
Analysts like Emily Stausbøll from Xeneta also point to external risks that could drive rates back up. Factors such as the conflict in the Red Sea region and a potential escalation of the US-China trade war under Trump’s presidency remain significant threats. Stausbøll underscores that while the global container market shows signs of weakening, a return to stable, low rates is far from guaranteed.
Source: Nieuwsblad Transport