International Container Shipping and Logistics Market Update: Week 48 of 2023
Week 48 of 2023 witnessed a stabilization in the global container freight rate index according to Drewry, maintaining at USD 1,382, a 40% decrease compared to the same period last year and 3% lower than the 2019 pre-pandemic average (USD 1,420).
Asia – North America Shipping Lane
Freight rates from Asia to the North American West Coast sharply decreased to USD 1,672/FEU, down 3.35% from the previous week and 6.17% from the previous month. Q4 Forecast: An increase in skipped sailings is expected, but capacity will likely remain equivalent to Q2 and Q3 due to increased demand ahead of the Lunar New Year starting in early December.
On average, 36 container ships transit the Panama Canal daily. However, this number has currently dropped to 32 due to prolonged drought conditions. The Canal plans to gradually reduce this to 18 transits per day by February 1st. Shipping companies are considering using the Suez route or rail transport through the US West Coast as alternative options.
Asia – Europe Shipping Lane
According to data from Xeneta, freight rates from Asia to Northern Europe slightly increased to USD 1,236/FEU, up 0.9% from the previous week and 28.75% from the previous month. There have been changes in the schedules of shipping alliances, with some services being canceled or temporarily suspended.
North America – Asia Shipping Lane
Freight rates from North America (West Coast) to Asia decreased by 2.62% to USD 744/FEU, a 0.53% decrease from the previous month. The shortage of empty containers at many US inland rail terminals due to a lack of imports is causing difficulties for exports. Shippers should book 2-3 weeks in advance to ensure their export plans.
Europe – Asia Shipping Lane
Freight rates from Northern Europe to Asia slightly decreased by 0.81% to USD 366/FEU compared to the previous week, but still increased by 4.27% compared to the previous month.
Conclusion: Overall, demand remains weak and is expected to continue until the end of Q1 2024. Intense competition is ongoing among shipping companies. Freight rates continue to be offered attractively by carriers to fill ships amidst excess capacity. The international container shipping and logistics market in week 48 saw no significant fluctuations compared to week 47. Carriers are actively seeking alternative solutions to maintain operations in a volatile market environment.
