The global container shipping market is entering a downward phase, as spot market rates decline for the fifth consecutive week. The downward trend in rates reflects weak demand on key trade routes and increasing capacity availability.
The scenario is further aggravated by the prospect of ships returning to the shorter Red Sea route, a development that frees up additional capacity and intensifies competition between lines. The Drewry World Container Index (WCI), the weekly index that captures the average cost of transporting a 40-foot container on the main global routes, fell by 1% to 1,933 dollars, mainly due to pressures on the Asia-North America and Asia-Europe routes.
Spot rates from Shanghai to major US destinations fell slightly due to low cargo volumes, with routes to Los Angeles and New York recording a 1% drop, to 2,214 and 2,800 dollars respectively. In order to contain the oversupply of capacity, carriers announced 57 cancellations for the next two weeks on the East and West Pacific routes, a number significantly higher than in previous years, according to Drewry’s Container Capacity Insight. However, the company estimated that freight rates on these routes will continue to move slightly downward.
A similar picture is recorded in Europe. The Shanghai-Rotterdam route fell by 2% to 2,127 dollars per 40-foot container, while the Shanghai-Genoa route fell by 3% to 2,965 dollars. At the same time, 24 cancellations have been announced in the Asia-Europe/Mediterranean market, in an environment of continued volatility and temporary factory closures ahead of the Chinese New Year, which begins on February 17.
According to Drewry, the sharp decline in prices contradicts the usual seasonal expectations for a boost in demand before the Chinese New Year. In fact, freight rates seem to have peaked earlier than usual, leaving open the possibility of a further mild correction in the coming weeks. Danish giant A.P. Moller-Maersk, warning that oversupply of capacity and the gradual reopening of shorter routes via the Red Sea could cut the group’s profits by up to half in 2026. “New ships are arriving and, at the same time, shipping via the Red Sea is likely to reopen. All of this will put pressure on rates this year,” Maersk CEO Vincent Clerc said.
Source: www.naftemporiki.gr
