Container freight rates take a dive
Transpacific box market records biggest fall in five years, but analysts say it’s just a blip.
Container freight rates have fallen by their highest level in nearly five years, with the benchmark Freightos Baltic Index (FBX Global) dropping 770, or 7.3%, on Friday, hitting 9,770.
The drop was precipitated by a sharp fall in the transpacific market with rates on the FBX1 route from China to the US West Coast falling $3,410 to $15,827 per 40-foot equivalent unit (FEU). Rates on the FBX3 from China to the US East Coast registered a drop of $841 to $19,963.
The falls reflect the volatile nature of the transpacific market and have been exacerbated by Covid-19 restrictions in China. Commenting on the fluctuations, Vespucci Maritime chief Lars Jensen wrote in the FBX newsletter:
“Over the past days, the number of local cases in China appears to be growing, and any impact on the other major port cities would significantly impact the supply chains as well.
“Hence, unfortunately, the current short-term outlook is not for an abatement of the very high rate levels. Instead, the risk elements are leaning towards a higher likelihood for increases than decreases.”
