The latest data from the Xeneta Shipping Index reveals long-term contracted rates fell by 1.1% in September. This is the first drop since January and one of only three declines in the past 21 months. However, analysts at Oslo-based Xeneta expect it won’t be the last.
Xeneta CEO Patrik Berglund commented: “Over the past couple of months, clear signs of a market shift have emerged. Spot rates have been dropping across the board and have, on some key corridors, plunged over the course of the last month as lower demand and easing port congestion take effect. The divide between the long- and short-term market is now wider than ever before on many trades, despite record numbers of blank sailings in what would normally be considered a peak season.”
The shoe is finally on the other foot
Berglund said “the shoe is finally on the other foot” when it comes to upcoming contract negotiations for Q4 and beyond.
“The shippers are in the ascendancy while carriers will now be competing to lock-in volumes in the face of lower global demand,” Berglund said.
On the spot markets new data from World Container Index (WCI) published yesterday showed main spot rates to either continue their pace of decline, or even accelerate this week.
Worst hit was the Asia to Mediterranean route which saw spot rates decline $1,200 per feu – or 19% – in just a single week. The one trade lane bucking the trend is on the transatlantic, which was up 4.5%.
“We are in the highly unusual situation that the Atlantic spot rate is now more than double of the rate on the Pacific into the US west coast and almost 30% higher than the Asia-North Europe rate level,” commented Lars Jensen from Vespucci Maritime.