Ocean freight rates continue to fall, "one box is hard to find" and "one cargo is hard to find"

　　Chang Zhiruo, Jin Yidan's trainee reporter

　　Recently, sea freight prices have continued to fall, with the Baltic Sea Freight Index (FBX) falling by more than 61% from its record high in September last year.

The container shipping market is weak, and "one container is hard to find" has become "one cargo is hard to find".

Industry insiders said that since the beginning of this year, the growth of consumer demand in the global market has been sluggish, and the superimposed epidemic factor has caused consumer spending to shift from consumer goods to the service industry, further reducing the demand for container shipping.

　　Capacity oversupply

　　FBX shows that on September 23, the global composite index was US$4,305/FEU (40-foot container), a drop of more than 61% from the historical high of US$11,109/FEU in September last year.

Among them, China (East Asia)-North America West Coast fell 10% from last week to $3,545/FEU; China (East Asia)-North America East Coast fell 8% from last week to $7,835/FEU; China (East Asia)-Mediterranean was from last week It fell sharply by 18% to US$6,748/FEU; China (East Asia)-Northern Europe fell more than 4% from last week to US$7,284/FEU.

　　Data shows that as of September 22, the Drewry World Containerized Index (WCI) has been declining for 30 consecutive weeks. This week’s WCI fell 10% from last week to $4,471.99/FEU, down 57% from the same period last year; Shanghai exports The Container Freight Index (SCFI) has fallen for 15 consecutive weeks, and this week fell 10.4% from last week to 2072.04 points.

　　The oversupply of shipping capacity in the shipping market is the main reason for the decline in freight rates.

Institutional data shows that in the third quarter of this year, global container shipping capacity increased by 3.9% year-on-year, but due to sluggish demand, the idle capacity rate hit a five-year peak.

　　Affected by the drop in freight rates, many shipping companies have begun to suspend sailings in order to change the situation of excess supply.

Data released by shipping consultancy Drewry showed that during the five-week period from September 19 to October 23, out of a total of 750 scheduled voyages on major routes such as trans-Pacific, trans-Atlantic, Asia-Nordic and Asia-Mediterranean, 122 sailings were cancelled, with a cancellation rate of 16%.

Among them, the world's three major shipping alliances have successively cancelled a total of 101 voyages.

The largest number of cancelled voyages was the 2M alliance with 40 voyages; the THE alliance with 33.5 voyages; the least number of voyages was the Ocean Alliance with 27.5 voyages.

　　Notably, 68% of vacant ocean sailings occurred on the transpacific eastbound trade route, 24% on the Asia-Nordic and Mediterranean routes, and 8% on the transatlantic westbound route.

　　Demand expected to rise in the fourth quarter

　　Drewry's analysis pointed out that weakening global container demand, sufficient inventory, consumer spending from goods to services, and an uncertain economic environment are the main reasons for the continued weakness in the current container shipping market.

　　Founder Securities said that due to the large amount of replenishment before, major retailers in the United States have cut retail orders sharply recently. Walmart has canceled billions of dollars in orders, and Target has canceled orders of more than 1.5 billion dollars in order to keep inventory levels in line with expected demand.

　　Xiao Junguang, secretary of the board of directors of COSCO SHIPPING Holdings, said that there has been a certain marginal change in the market supply and demand recently.

On the supply side, port congestion in major shipping areas has eased recently, and shipping capacity has been gradually released; on the demand side, under the influence of factors such as increasing inflation pressure and high energy prices, market demand has declined to a certain extent.

Under the combined effect of the above factors, the spot market freight rate has been adjusted to a certain extent.

　　"We believe that the current demand is at a relatively low point this year, and it is expected to rise in the future." Xiao Junguang said, "According to the preliminary survey of the market, customers are currently gradually destocking, with the consumer confidence of consumers. Gradually recovering, it is expected that the market demand will increase in the fourth quarter of this year, which will help to further improve the overall supply and demand relationship in the market.”

　　Huatai Securities believes that the spot freight rate will maintain a gradual downward trend, but the freight rate level will still be significantly higher than before the epidemic.