During this period, we saw an increase in the short-term container freight rates. But also long-term container freight rates have now increased. Meanwhile, rates between the Far East and the United States have risen the most. Copying the development in short-term contracts which have seen the increase in freight rates to the US (both coasts) outpacing the rise in spot rates to Europe. Given the current market power, BIMCO has expected such an increase in long-term ones.
In general, more containers are moved in long-term contracts than in short-term ones. As a result, long-term contracts are the key to the profitability of carriers. The rate jumped by hundreds of dollars overnight.
Long-term rates, meanwhile, made the first leap to the west coast of the United States. These rates had experienced a slight decline over a long period of time. Between September 30 and October 1, long-term rates of $ 1,496 reached $ 2,052 per FEU. As a result, it was a 37.2% jump. But from October 13, it dropped to $ 2,014. However, it has still increased by 44.1% compared to last year.
In the meantime, we are seeing more jumps in East Coast rates. They had an increase of $ 721 per FEU. They have risen in price from $ 2,412 on September 30 to $ 3,133 on October 1. Here the rates fell again. But at $ 3.207 per IP, it is still 25.7% higher than last year.
The data also show that the volume is increasing despite the weak start of the year. In the first six months of the year, container volume between the Far East and the United States fell 8.5%. Its volume was absolutely about 300,300 TEU. However, we saw the volume remain constant in August and July. Both months of this year have recorded a larger volume than the corresponding months in 2019. Thus, in July and August, the volume of containers increased by 180,000 FEU and 280,000 FEU.
With this large volume, shipping from China to USA has grown significantly compared to world trade in the first eight months of the year.
In the United States, retail sales fell 15% in the first eight months of the year. But now the sector is up 0.9% from last year. The robust demand for goods means that container shipping has been less affected than overall growth figures would suggest. Because the industries suffering the most are less reliant on trade. Container shipping into the US has been less affected than what overall growth rates would suggest. Because many of the hardest hit sectors (eg, services) are less reliant on trade, than retail sales which have proven quite resilient. Furthermore, the decline in imports in the first half of the year mean inventories need restocking. Also importers may be looking to frontload stock ahead of more potential disruption to supply chains from a second wave of COVID-19 cases.
On that side of the globe, on the Green Continent, prices are rising more slowly. Hence, long-term rates from Asia to northern Europe have increased less. They are currently around $ 1,600 per FEU. $ 137 more than September 30th.
The recovery in volumes has been weaker compared to the recovery seen on the Far East to North America trade. Between the Far East and Europe accumulated volumes are down by 10.3% in the first eight months of the year. It has a loss of 1.2 million TEU compared to the same period in 2019.
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