The new capacity has been delivered in large quantities, but the market demand is decreasing. The peak season of the golden week is not strong, and the freight rate continues to fall. The Shanghai Export Container Freight Index (SCFI) has fallen for 17 consecutive weeks.

 

According to the data released by Shanghai Airlines Exchange on October 14, the latest SCFI index fell by 108.95 points to 1814 points, a drop of 5.7%, 65% from the peak at the beginning of the year. The freight rates of the four major routes in Europe and the United States dropped directly, with the weekly drop of more than 12% on the American Western route and the European route, and the drop from the peak was 74% and 67% respectively.

 

Last week, the freight rate per FEU on the US West Line fell by US $302 to US $2097, or 12.5%; Each FEU of the US East Line fell by 343 dollars, and the loss of 6000 yuan fell to 5816 dollars, a decline of 5.6%. For the European line, each TEU fell by $369 to $2581, a decline of 12.5%; The Mediterranean line fell by $252 per TEU to $2747, or 8.4%.

 

The freight rate of South America Line (Santos) per TEU rose by $95 to $5120, or 1.89%; The freight rate of Persian Gulf Line per TEU rose by 295 dollars to 1171 dollars, or 28.40%.

 

In terms of the Asian line, Japan's Guanxi Line rose slightly by $14 to $325 per TEU, or 4.5%; Japan US Kanto Line rose slightly by $1 to $302 per TEU. The Southeast Asian Line (Singapore) also rose slightly to $349 per TEU, while the South Korean Line (Busan) fell slightly to $254, or 3%.
 

The industry analysis pointed out that although the SCFI index had fallen for 17 weeks, the decline last week did not increase because of the golden week, but the average weekly decline of nearly 10% was narrower than the previous weeks. The freight rates of routes such as the Persian Gulf and South America also rebounded, and the freight rates of the Asian line were also stable. It is estimated that the freight rates of the European American line will not fall too much in the off-season of the fourth quarter, but will be supported in the peak season of the Asian line.

 

Influenced by interest rate rise, inflation, war, epidemic situation and other factors, the demand in Europe and the United States slowed down rapidly, but at the same time, the market released a large amount of transport capacity, mainly from the relief of the port and the launching of new ships. At present, the congestion problem has been eased by half compared to the beginning of the year, which means that freight rates will soon return to normalization.

 

Alphaliner predicted that nearly 2.4 million TEUs of new capacity will be delivered for operation next year, more than double the 1.1 million TEUs in the same period last year, and the new capacity will reach 2.8 million TEUs in 2024, increasing the market's concern about excess capacity. Nearly 30% of the transportation capacity is dual fuel ships, which are estimated to be mainly used for fleet updating in response to the new environmental regulations coming into force next year.

 

Analysts said that at present, the freight rate of the European and American lines is still above the cost price, and the main container transport companies can still make profits, but many container transport companies or small ships that charter ships at high prices may face a turning point of loss, especially the American Western Line.

 

On the other hand, the three maritime transport alliances also have enough capacity to regulate the transport capacity. The top ten container transport companies in the world control 85% of the transport capacity of the market, and can further control the supply of transport capacity through ship pumping and shift reduction. In order to cope with the sharp drop in freight demand and freight rates from the Far East to North America, Mediterranean Shipping and Maersk Shipping, the two largest shipping giants, have announced the closure of some route services.