The Drewry World Container Index (WCI) pulled itself above US$1,500, once again owing to a good showing by the transpacific China-US head haul trade, ending at US$1,536. The Shanghai- Los Angeles trade ended at US$1,965 ending at a five-month high and registering a 24.2% growth in just 3 weeks.
The Shanghai-New York trade ended at US$2,906, logging a weekly gain of over 7%. The rates for China-Europe ended in a near status-quo.
At a time when the other trade rates ended in the red territory for the week the transatlantic tickers showed the rates for Rotterdam-New York at US$1,640, their lowest in 12 years. Prior to this, the lowest level locked on the trade lane was at US$1,691 last recorded around November 2017.
The rates for the trade lane dunked a good 7% this week to breach those levels. The rates for the trade lane have more than halved in just six weeks. The rates for China-Mediterranean dipped another 2% for the week but are at about 20% higher than their lowest levels recorded in the post-pandemic era.
It must be noted that this was the first time the WCI had recorded consecutive upticks on a weekly basis since its fall from Chinese New Year 2022. While the fall has stemmed temporarily owing to the strong showdown from Transpacific rates, this could also traditionally be because the months of June to September saw some high volumes in 2022 (Far East-North America) to stack up inventory for the high consumption season.
Whether this is still the case and the trigger for rising prices in the short-term remains to be seen. Drewry has maintained their commentary saying, “East-West spot rates to decline marginally on most routes in the next few weeks.”
Author of the article: Gautham Krishnan
Gautham Krishnan is a logistics professional with Fluor Corporation, in the area of project logistics and analytics, and has worked in the areas of Project Management, Business Development and Government Consulting.