Falling! Sky-high shipping costs end 13 consecutive increases

Affected by the Red Sea detour and port congestion, shipping rates on major routes such as Asia-Europe, North America and South America have been rising one after another since April this year, and this trend has continued for more than three months.

Recently, data released by the Shanghai Shipping Exchange showed that the Shanghai Containerized Freight Index ( SCFI) was 3674.86 points, a slight decrease of 1.6% from the previous period.

After 13 consecutive weeks of skyrocketing, shipping costs seem to have finally reached a cooling "turning point".

Data shows that except for some routes (Far East to Europe and Southeast Asia) where freight rates are still rising, freight rates on other routes are showing a downward trend.

Specifically, on July 12, the freight rate (sea freight and sea freight surcharge) for exports from Shanghai to Europe was US$5,051/TEU, up 4.0% from the previous period.

The freight rate for Shanghai exports to the West Coast of the United States is USD 7,654/FEU, and the freight rate to the East Coast of the United States is USD 9,881/FEU, down 5.5% and 0.6% respectively from the previous period.

It is worth mentioning that this is the first time in the past three months that freight rates in the US East and West have fallen at the same time. According to previous speculation, starting from July 1, freight rates in the US West will rise to US$8,100-8,500, while freight rates in the US East will rise to US$10,300-10,400.

In addition, the freight rate for Shanghai exports to the South American market also fell by 2.9% compared with the previous period, and fell slightly by 0.1% to the Mediterranean market.

The news of "falling ocean freight rates" is undoubtedly a big boon for sellers who have been troubled by rising freight rates. Some sellers said that the continued surge in freight rates, coupled with the coming of the peak season in July, has brought them tremendous pressure. Now that prices have fallen, it is like a long-awaited rain, and they can finally breathe a sigh of relief.

At the same time, a freight forwarding manager said that it has become much easier to book space in the past two days. Except for the slightly tight European line, the tension in other space has eased compared to May and June, and freight rates are expected to gradually decline in the future.

However, some cargo owners said that the current quotes provided by freight forwarders are similar to those in early July, and booking is still difficult. Some people also questioned why the ocean freight rate has dropped when the Red Sea crisis has not yet been resolved.

In this regard, professionals analyzed that the reason for the decline in shipping costs may be the change in the supply and demand relationship in the global shipping market.

Some time ago, many overseas countries imposed tariffs on "small packages from China and new energy vehicles", resulting in a decrease in commodity shipments and export demand. The phenomenon of oversupply caused the skyrocketing shipping costs to show a rare sign of decline.

It is worth noting that the shipping giant Maersk has pointed out that the current situation of the Red Sea detour is difficult to be resolved in a short period of time and is expected to continue until the third quarter of this year. In addition, experts in the field of container shipping consulting also said that the deadlock in contract negotiations among dock workers on the East Coast of the United States may trigger a wave of strikes in the fall, becoming a new round of uncertainties affecting ocean freight rates.

Based on this, the editor must remind everyone that we are currently in the July promotion. Although freight rates have been reduced, relevant companies and sellers still need to be cautious about market demand to prevent the changing ocean freight rates from affecting peak season shipping plans.