Against the backdrop of extremely weak demand forecasts, shipping companies are preparing to cancel about half of their scheduled voyages from Asia to northern Europe and the US after the Chinese New Year on January 22. (For more information on logistics from China to Pakistan, follow EMAN)

Meanwhile, after several weeks of double-digit declines, freight rates in the spot container market leveled off this week, suggesting a possible bottom has been reached.

The latest Drury World Container Rate Index closed at $2127.33 per FEU(40-foot container), down 1% from last week and down for 42 consecutive weeks.

Down 77 percent from the same week last year; Down 79% from last September's high of $10,377 per FEU; That's down 21% from the 10-year average of $2,692 per FEU, marking a return to more normal prices, but still 51% higher than the 2019 pre-pandemic average of $1,420 per FEU.

On trans-Pacific routes, for example, the AsiAn-American index was little changed this week, with Xeneta's XSI index averaging a rate of $1,496 /FEU. For the eastern United States, Drury's WCI Index of world container rates edged down just 1% to $3,952 per FEU.

Indeed, ONE CEO Jeremy Nixon, who attended the monthly media conference at the Port of Los Angeles this week, said he expects short-term rates to remain flat until 2023, adding: "I think spot market rates have bottomed out."

But he warned that Asian exports would fall sharply after the Lunar New Year holiday, with very weak exports in February and March. "We can only see if demand starts to pick up around April or May." Overall, U.S. imports will be weak in the first half of next year, and may not gradually recover to normal conditions until the second half of 2023.

On the Asia-Nordic trade route, spot rates for the major indices this week ranged from $2,167 /FEU for the Baltic FBX to $1,674 /FEU for the Delury WCI.

However, according to Loadstar's report, shipping space to Northern Europe will be increasingly tight before the Lunar New Year. Many of the route's annual contract negotiations, which are usually finalised in December or January, appear to have stalled as shippers and shipping lines have been reluctant to commit in uncertain market conditions.

Spot rates from Asia to Mediterranean ports also held steady this week, with the WCI index at Deluree, for example, unchanged at $2,909 /FEU.

But transatlantic routes remain the exception, with short-term rates from northern Europe to the American East still at least three times higher than before the pandemic. In fact, the XSI from Northern Europe to Eastern America even rose slightly this week to $7,189 per 40 feet.

The strength of the dollar against the euro and sterling, coupled with an increased focus on sourcing products from Europe, has kept trade strong despite economic downturns elsewhere.

However, rates on transatlantic routes are set to fall sharply because of a 43 per cent year-on-year increase in capacity, according to maritime consultancy Sea-Intelligence. Analysts at Sea-Intelligence said: "Spot rates on both sides of the Atlantic are likely to collapse in the coming months."