General

With the gradual recovery of economic activities in Europe and the United States and the increasing market demand for various materials, import demand from Europe and the United States continues to remain high. However, container detentions, ship hopping, poor transportation turnover, and port congestion caused by the epidemic have become the norm (South China port congestion, US West Coast congestion, European Rotterdam and Hamburg congestion-see article: Europe's two largest The port is heavily congested! HPL has suspended calls for seven consecutive weeks, and 2M has jumped to the port for eight consecutive weeks!) The deadlock in the transportation market's tight capacity has not yet eased, and the freight rate in the container shipping market continues to hit historical highs.

The short-term freight from China to Northern Europe has exceeded the 20,000 USD per 40 feet mark, while the trans-Pacific shipping company to the west coast of the United States has offered up to 25,000 USD. It was reported last week that the offer from Shanghai to Los Angeles reached 32,000 US dollars.

Relevant foreign data show that in July, the top 5 shipping companies for cargo from Chinese ports to the ports of Felixstowe and Southampton gave USD 21,000 per 40 feet. Quotation, the average price is about 18,000 US dollars.

Although these greatly increased rates include additional costs to guarantee equipment and space, some shippers complain that their cargo is still getting rolled.

"We paid their ridiculous fees and thought it would end here," a freight forwarder said. "But then we found from the local agent that the box was still on the dock. Obviously, there was another ship on the next ship. An opportunity for FAK to increase prices, which means that their so-called premium premiums are worthless."

As the peak season approaches, the situation for shippers heading to Europe and the United States seems to get worse. They will need to be prepared for a new round of FAK and GRI price increases from July 1st, and they will also face another fee increase from mid-July, as well as thousands of dollars in PSS (peak season surcharge). (View article: Ocean freight will increase again from July 1st!)

A UK-based NVOCC said that a "short e-mail" from his carrier suggesting another price increase was like an overwhelming "last straw." He said: "Even if their status in the industry is very low, we have always supported them to tide over the difficulties. This is how we get rewarded."

In the trans-Pacific region, shippers are also facing similar problems. Jon Monroe of Jon Monroe Consulting stated that the carrier has the ability to "manipulate freight rates" through cargo rolled, which indicates that the US Shipping Law needs to be updated to include the upper limit of freight rate increases and the non-fulfillment of the contractual damages clause.

At the same time, Craig Grossgart, senior vice president of global shipping of Seko Logistics, has confirmed that last week, a shipper offered $32,000 for a 40-foot container from Shanghai to Los Angeles. "To be honest, I think this is a polite way for carriers to express to customers that they don't want to accept their business." Grossgart said.

nulltheless, he stated that he has offered an offer of US$25,000 per 40 feet to a shipper who needs to ship 300 containers from Shanghai and Yantian to Los Angeles next month-"This is a serious offer."

With the increase in premiums, coupled with a large number of other expenses, the gap between the spot market index and the actual payment rate is widening week by week. For example, the Freightos Baltic Index launched by the Baltic Shipping Exchange and Freightos in the past week showed that the Nordic Freight Index was 10,979 US dollars per 40 feet, the Mediterranean Freight Index was 11098 US dollars, and the US West Coast FBX Index was 6905 US dollars. , The FBX index of the East Coast of the United States is 9891 US dollars.

FBX-Nordic Mediterranean

FBX-US East and West

The World Container Index released by Drewry on the 24th marked the biggest increase since its establishment in 2012. A further increase of 15.9%, reaching $8061.65/FEU, an increase of $1,104, an increase of 332% over the same period in 2020.

Sea freight rates continue to rise:

The freight rate from Shanghai to Los Angeles increased by more than one third in one week, from US$6,358/FEU last week to US$8,548 last week.

Prices from Asia to the east coast of the United States also soared 39% to $11,180/FEU.

The spot price from Shanghai to Genoa rose by US$603 to US$11,448 per 40-foot container, a 540% increase over the same period in 2020.

The freight rate from Shanghai to Rotterdam increased by USD 779 to USD 11,1975, a year-on-year increase of 626%.

British analysts said: "Drewry expects that rates will remain at a relatively high level in the coming week."

At the same time, last Friday's latest Shanghai Container Freight Index (SCFI) rose another 37 points, reaching a new high of 3785.40 points, an increase of 1.0% from the previous period.

Lars Jensen, CEO of consulting firm Vespucci Maritime, commented on the latest record-breaking freight rate: "All capacity transactions are expected to face upward pressure."