The S&P Global Platts Container Index fell $17.50 in the week ending November 17 to $913.83 as fundamentals seemed to have won the battle from the previous week as the most head-haul routes dropped $50 last week, the North Asia to Mediterranean and North Asia to UK and North Continent routes in particular, ending the week at $950/FEU and $1,150/FEU, respectively.
Both these routes had quotes lower than these assessments so they could fall further this week. There are some supply-chain issues that are causing spot rates to diverge for specific cases on the North Asia to UK and North Continent route.
One logistics source said “carrier performance has meant certain beneficiary cargo owners swapped carriers paying, in some cases, a $200 premium to ensure their cargoes arrive as per the advertised schedule.”
This is at a time when securing annual contract renewals is key, especially when box rates are being quoted between $1,300/FEU and $1,400/FEU.
Holding carriers’ performance to account this year may lead to end-users shifting alliances to ensure a stable supply chain in 2018.
The North Asia to East Coast North America head-haul route also dropped by $50 to $1,800/FEU in the week ending November 10.
Certain market participants believe it should be lower but the majority of carriers are trying to hold rates firm at least till after the Thanksgiving holiday in the US.
The West Coast North America route remained at $1,300/FEU. The East Coast North America to UK Continent route is bucking the trend by increasing again last week by $25 to $550/FEU.
This potentially could continue upward next week as spot quotes are frequently between $600 and $650/FEU depending on the load port.
Source: Hellenic Shipping News.