Container spot rates have dived by 18% in June on the previous month and operators should not count too much on the forthcoming high season in the sector to turn the picture prettier, a senior shipping analyst said.
“Spot rates have so far in June fallen by 18% from May and thereby they have reached a new bottom level after the general rate increases announced on Asia-Europe trade for 1 June failed completely,” said Jacob Pedersen, senior analyst at Sydbank in Denmark.
“The month is ending with firmer rates ahead of the significant rate increases announced to take effect on 1 July,” he said. However, these USD1,000 to USD1,200 per teu increases are unlikely to hold, given non existent discipline in pricing between operators and weak development in volumes.
“There is an urgent need to optimise networks and to reign in capacity. The high season in the next few months will help to deal with the imbalances, but laying up tonnage is a necessity if operators want to obtain profitable freight rates,” he said in a monthly report on shipping markets.
Earlier this month, Container Trade Statistics, the UK based consultancy, said that its container freight rate index that covers both spot and contract rates, fell by three points to 76 in April. This was the sharpest fall since the beginning of 2014, according to a chart on the company’s website. The index has lost five points since the beginning of this year and nine points since April 2014, the chart shows.