Evidence has emerged suggesting that spot rates from Asia to North Europe may be coming down, seemingly in response to faltering demand.
According to a report in The Loadstar, there is growing evidence to suggest that freight rates from Asia to North Europe may be reducing for shipments after China’s Golden Week holiday in October. Toy World has also seen a quote from a Far East based freight forwarder to a UK-based importer which reinforces this assertion.
The Loadstar quotes two Chinese forwarding agent sources which claim that Hamburg Süd has reduced its October Shanghai to Felixstowe rate offer to $15,000 for a 40ft container, which is around $2,000 – $3,000 below current rates. Although the offer is time limited (valid until 20th October), one of the forwarders believes it could be extended and that other carriers might follow suit, in order to fill their allocations.
The UK commercial manager of one UK forwarder also told The Loadstar that he perceived demand from Asia to North Europe was starting to drop, especially for lower-value cargo, as a consequence of sky-high freight rates. It is also plausible that some companies will have decided that shipments may be starting to get late to hit the Christmas season, and may have elected to hold off bringing in further containers while punitive shipping rates impact profitability.
Meanwhile, in stark contrast, there are no signs of a let-up in demand on the Asia to North America route, despite the enormous rate hikes. According to Los Angeles’ Signal port optimiser data, import volumes due next week are 36% higher than for the same week of 2020, while manifested cargo arriving between 19th – 25th September is anticipated to be 51% higher.
However, many of these ships will have no choice but to anchor or drift in the San Pedro Bay area, with the 50 or so vessels awaiting a discharge window at Los Angeles and Long Beach terminals currently taking an average eight days to berth.