CCFI Commentary in Issue 01, 2012

Weekly Report of China Export Container Transport Market


China export box market seemed active in demand this week where rates on major trades jumped up. On December 30th, the China Containerized Freight Index issued by Shanghai Shipping Exchange stood at 881.15 points, little change from last week; while the Shanghai Containerized Freight Index issued by SSE surged 10.6% to 947.58 points.

Driven by the traditional export rush before the New Year, rate strengthened this week on the Europe trade, where the average slot utilization rate returned to around 95%. Some shipping lines pushed up rates greatly due to some sailings even with full slots. With the support of the big volume, many carriers set to lift rate by $200/TEU.

On December 30th, the freight rate plus surcharges from Shanghai to base ports of the Europe issued by SSE rose 30.8％ to $701/TEU.

Moreover, the China/Mediterranean trade also saw a boost in volume, where rate went up in a greater stride.

On December 30th, the freight rate plus surcharges from Shanghai to base ports of the Mediterranean issued by SSE surged 13.2% from a week earlier to $714/TEU. Experts expressed that the substantial rate surge was a result of the rate rebound from a low base at the end of the year after a lasting stagnated market through the 2nd half of 2011 as well as the willingness of carriers, who hold a bleak outlook over 2012, to take advantage of this rate rise to create some room for future adjustment. However, the continued up-trend depends on market demand in the coming year.　

Volume was plentiful on the North America trade this week, where the average slot utilization rate for the UCWC service and USEC service remained both over 95%, many sailings even with full slots. In the meantime, some shippers rushed to ship cargoes out before the New Year as rate on the route was scheduled to move up by $400/FEU from Jan 1st of 2012, making the rate soar up for the tightening slots.　

On December 30th, the freight rates plus surcharges from Shanghai to base ports on the USWC and the USEC issued by SSE stood at $1,692/FEU and $2,892/FEU, up 18.8% and 14.4% respectively.

Pushed by the New Year’s volume peak, rate rose violently on the Australia and Singapore service this week, with the average slot utilization rate over 85%.

On December 30th, the freight rate plus surcharges from Shanghai to base ports of Australia and Singapore issued by SSE climbed up 16.6% to $821/TEU.

Volume kept stable, though, a slight up on the South America service, with the average slot utilization rate over 90%, some sailings even with full slots. In the face of the New Year, some lines planed to raise the rate by $500/TEU.

On December 30th, the freight index from Shanghai to base ports of South America issued by SSE soared up 33% from last week to 860.52 points. However, some insiders said that the actual volume was limited though the rate rose greatly, therefore, it is likely to decline again when the shipment tide receded.

In the contrast, without the drive of the New Year’s shipment peak, volume dropped a little on the Japan service this week. The average slot utilization rate from Shanghai to Japan stood at 75% and rate was almost unchanged. December 30th, the freight index of the Japan service issued by SSE was reported at 718.57 points, in line with last week’s.