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Freight rates rise, Drewry World Container Index snaps losing streak
The Drewry World Container Index (WCI) snapped a losing streak with a weekly gain of 3.8%, driven by a strong rise in prices on the US-China trade lane.
The hardest-hit Shanghai-Los Angeles (China-U.S. west coast) route rose 11% this week, from $1,674 to $1,856.
The outperforming Shanghai-New York (China-US-East Coast) trade lane was another outperformer, with prices up 12% to $2,849 for the week.
It must be noted that while contracts are being negotiated, reviewed and renewed for this year, freight rates also increased earlier this week due to General Rate Increases (GRIs).
Drewry's World Container Index recorded its best weekly move since July 2021 for about 21 months after falling for 15 consecutive weeks and recording its second weekly gain since March 2022 .
While indices such as the Freight Forwarding Composite Index (FBX) and the Shanghai Containerized Freight Index (SCFI) posted gains earlier in the month, higher rates helped the Drewry index perform well despite the Los Angeles-Shanghai and New York-Rotterdam bases Lower rate trade lanes took a 4-5% hit.
It must be noted that Drewry's analysts also revised their rate forecast for the coming weeks from "slight decline" to "stabilizing" to "expect rates to rise, except for transatlantic rates." Container shipping lines are now upping the ante and are also starting to eat into the small and breakbulk market.
It was also recently reported that the inflation rate in the United States has fallen to 5% in March 2023, which indicates that people's spending power has increased.
Source: Logistics Baba
