According to the latest data released by the Shanghai HNA Exchange on February 3, last week, the Shanghai container freight Index (SCFI) fell 22.86 points to 1,006.89 points, the decline widened to 2.22 per cent. The main long-haul routes fell across the board, including the European routes below the $1,000 level.(For more information about international shipping forwarders, follow Iman Logistics)

Last week, rates on the Far East to Europe line fell $53 per TEU, or 5.23 per cent, to $961. The Far East to Mediterranean line dropped $62 per TEU, or 3.41 per cent, to $1,754. The FEU rate for Far East to Western America fell by $40, or 2.8%, to $1,363. The FEU rate on the Far East to Eastern United States line fell $77, or 2.77 percent, to $2,706.

In addition, the Far East to South America Santos points of $376 to $1,441 per TEU last week, up 35.3%; $40 to $1,040 per TE to the Persian Gulf; The price per TEU to Singapore, the Southeast Asian capital, fell by $4 to $154.

It is known that the SCFI index fluctuated at 800-1100 points between 2018 and 2019. Since 2020, affected by the epidemic, the shortage of workers and port congestion caused chaos in the global supply chain, the SCFI index has been rising all the way, and reached a historical high of 5109 points in the first quarter of 2022. However, since the second half of 2022, freight rates have been falling for six months. Only at the end of December last year, they turned red for a while. After a flash in the pan, they fell again in the New Year, and now they have fallen more than 80 percent from the beginning of last year.

Industry insiders said that the Spring Festival holiday in January affected shipments in China. In the case of oversupply of ship capacity, container shipping companies continued to scramble for goods and bargain prices. Most of the European lines are ten thousand container ships, with small cargo volume and heavy filling pressure. With many factories in mainland China delayed because of falling orders from Europe and the United States, container companies estimate that it may take until March for shipments to pick up significantly.

In an effort to keep rates stable, container companies have continued to tighten space supplies while shifting to routes that are still profitable. At present, the transatlantic route, Europe to the east of the United States per FEU freight rate is still more than $6,000; The Far East to South America line also rose last week to $1,441, although many routes are subject to price fluctuations as more ships arrive.

Chang Yan-yi, the chairman of Evergreen Shipping, said that unless the freight forwarding company adjusts its capacity significantly, the price war will continue, and the two main routes, such as the United States and Europe, may fall below the line of profit and loss, affecting the profits of the freight forwarding company, and small companies may even lose money.

However, the chairman of Yangming Shipping Zheng Jung-moo believes that there are still positive signs of recovery, we can feel the market panic reduced, if the overall economic environment continues to improve, consumer demand will return, the container market conditions in the second half of the year than the first half of the opportunity to increase.

Source: International shipping network, shipping information for reference only