The trajectory of container trading and shipping rates, which has been upward since October 2023, has reached a period of moderate stability. During July, average container trading rates in China did not showcase any price spiking and remained relatively stable. Simultaneously, container shipping rates have also been stable during this period.
Container xChange and Drewry, both market specialists, confirm the two trends, respectively. It should be underlined that container trading rates differ from container shipping rates as they refer only to the price of trading containers and not shipping them. According to Container xChange, July is the first month in 2024 when container trading rates reached relative stability despite minor fluctuations. The same does not apply to container leasing rates from China to the US and Europe. Currently, this segment continues showcasing steady price surges.
Quoted professionals based in China indicate that, at the moment, “China’s container demand is surging, particularly for shipments to the US, driven by increased consumer spending”. This trend unfolds despite capacity restrictions and route disruptions, which heavily affect the container leasing market.
Regarding the market outlook, Christian Roeloffs, CEO of Container xChange, underlined that professionals should not be tricked by the seemingly upswing trend in trade, resulting in more stable container rates.
On the contrary, he warned that the currently increasing demand is mainly due to large retailers stocking their inventories in advance of the peak season–not an actual demand recovery. To a certain extent, this situation will probably affect container trading prices in the coming months: “The likelihood of container prices sliding and stabilising at a lower level is high. The recent stabilisation of container prices in China aligns with an earlier forecast, suggesting that the peak of price hikes may have been reached or is nearing soon”.
Shipping rates also stable
Another container market expert, Drewry, highlighted via its latest World Container Index (WCI) report that container shipping rates also stabilised during July. The rollercoaster course prices followed since the Red Sea crisis emerged saw rates spike, dip, and spike again until reaching moderate stability after H1 2024.
In any case, the price of shipping a container through the globe’s major trade routes is currently way higher than it was a year ago. Whereas in the summer of 2023, the discussion focused on the historically low rates that were upping competition between shipping companies while broadening the price gap with overland transport, the situation is different in the summer of 2024. At the moment, according to Drewry’s WCI and despite the price stability of the past few weeks, shipping a 40-foot container costs approximately 4,000 US dollars extra compared to the same period last year.
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