A sharp fall in the container spot rates last month indicates that there is no discipline in pricing in the industry in its low season and suggests a weaker than foreseen 2015, a senior analyst said.
“Falls in freight rates have continued in April, with the rates 12% lower than in March and at record low levels,” said Jacob Pedersen, shipping analyst at Sydbank in Denmark.
“The record low rates highlight brutal overcapacity, compounded by non-existent discipline in pricing in the middle of the low season,” he said in a monthly report on the shipping markets.
General rate increases of USD700 to USD1,000 teu that carriers have announced to take effect from the beginning of this month will provide a new test of the carriers’ negotiating position. “Should success with the rate increases fail to take place, a lot would indicate that the fall in rates for (the full year) 2015 will be greater than what we had foreseen in the sector,” he said.
In such a case, the carriers should pay even greater attention to optimising their networks and to control of capacity and to lay up tonnage, he concluded.