Container rates down for second straight week

The Drewry World Container Index (WCI) dropped 10 per cent to US$2,212 per 40-ft container for the week of Jan. 19-23.

For the second straight week, Drewry said the decline is primarily due to a drop in rates on the Transpacific and Asia–Europe trade routes.

Spot rates on Shanghai to New York decreased 11 per cent to US$3,191 per 40-ft container and those from Shanghai to Los Angeles fell 12 per cent to US$2,546.

Carriers increased blank sailings this week to counter softening demand following the end of the Chinese New Year cargo rush. Drewry expects freight rates to decline further in the coming weeks.

Spot rates on key Asia–Europe trade routes continued to decrease for the second consecutive week, with Shanghai–Rotterdam dropping nine per cent to US$2,510 per 40-ft container and Shanghai–Genoa falling eight per cent to US$3,520.

Amid declining rates, carriers are adopting divergent strategies for the Suez Canal: CMA CGM is switching three Asia–Europe services from the Suez route to the Cape of Good Hope route, while Maersk plans to resume its scheduled service from India to the U.S. East Coast via the canal starting Jan. 26.

These conflicting operational decisions suggest that effective shipping capacity will be reintroduced to the market gradually rather than all at once. This ‘drip-feed’ approach allows carriers to carefully assess risk and adjust their future networks, preventing a catastrophic collapse in spot rates.