Container Shipping prices are under fire as the market index for Asia to North-Europe is still on the decline, the average price for a 20ft container saw a 19% drop since 26th of May compared to the 26th of June. The market average for a 40ft in Asia to North-Europe performed similar with a 20% decline in container shipping rates in the same period.
The rate pressure is higher than ever with the announced general rate increase on July 1, where ocean carriers are attempting to push GRI’s up to $1000 per 20ft container – the highest increase ever. The rates are expected to rise from today’s levels, as the average prices for trade lanes like Shanghai to Rotterdam is as low as $877 per 20ft and $1,488 per 40ft, last tracked on the 26th of June. Compared to May, that’s a 13% decrease on 40ft and 10% decrease on 20ft.
After the GRI was released in March, we saw that the prices held steadily for a couple of weeks, but dropped significantly in the beginning of April. Therefore, it is pure guesswork to say how long prices will hold with ocean rates being as volatile as they are. The lowest rate we have seen per today is less than $500 on Qingdao to Le Havre for a 20ft container.
The bottom line is that the global market has overcapacity, and whenever rates reach sustainable levels, carriers will seek to fill this capacity, with rate erosions as the natural consequence.
We can also report that the average rate for a 40ft container, on several other key trade lanes like Shanghai to Felixstowe, was at $1,500 and Tianjin to Antwerpen was at $1,583. These two trade lanes are just a small part of the growth we have seen with our now 2300 port pairs and it continues to grow as more shippers and suppliers take part.