Ocean shipping rates hit multi-year low
Trans-Atlantic shipping rates have experienced a significant decline, with various index providers presenting slightly different figures, but all confirming a substantial drop below pre-pandemic levels. According to the Drewry World Container Index (WCI), rates for shipments from Rotterdam to New York reached a peak of $7,426 per forty-foot equivalent unit (FEU) in November 2022. However, by the latest recorded week, these rates plummeted by 79% to $1,577 per FEU. The current WCI assessment not only stands 20% below 2018 levels but also 33% below those of 2019, before the pandemic. Remarkably, these rates are the lowest in at least 12 years, as indicated by Drewry’s data.
Similarly, the Freightos Baltic Daily Index (FBX) revealed a peak of $10,708 per FEU for Europe-East Coast spot assessments in June 2022. By the most recent data, this figure collapsed by 88% to $1,236 per FEU. Notably, trans-Atlantic westbound rates have consistently been beneath pre-COVID levels since June, remaining 29% lower than those of 2019.
Xeneta’s tracking of both short-term (spot) and long-term (contract) rates underscores the trend of falling spot rates in the North Europe-East Coast lane. While average spot rates stood at $1,510 per FEU as of the recent assessment, they had plunged 83% from the peak of $8,793 per FEU in mid-May 2022 and were down 35% compared to rates at this point in 2019.
Interestingly, the Trans-Pacific route presents a contrasting scenario. In that region, spot rates have surged above contract rates, a dynamic opposite to the Trans-Atlantic situation. In essence, the Trans-Atlantic shipping sector is grappling with a sharp decline in rates, evident across various index providers, as rates drop substantially below pre-pandemic norms, casting a spotlight on the evolving market dynamics.
