Shipping rates from China to the US have “finally slumped” with spot rates halved on some routes due to power cuts and Covid-19 outbreaks in China, according to an industry report.
Figures from digital freight forwarding platform Shifl show long-term rates for 40-foot containers from China have dropped below $5,000.
Shabsie Levy, founder and CEO of Shifl told the FT that rates could go lower still as agents that took advantage of price increases and congestion by buying up capacity are looking to unload it, sensing the market has peaked.
Meanwhile, maritime analysts Drewry and MSI (Maritime Strategies International) do not expect the supply chain crisis that is inflating key-route freight rates to normalise before the end of 2022.
“Supply chain turmoil will last longer than thought,” says Drewry in its latest Container Forecaster report.
The FT suggests that Christmas could yet nudge prices for Europe and the US up as retailers prepare for the holiday season.
An end to freight disruption may not happen until next year, notes Seatrade Maritime News.
The publisher estimates that 12.5% of global container shipping capacity is caught up in delays, according to data from Sea Intelligence’s Global Liner Performance (GLP) and Trade Capacity Outlook (TCO) databases.
Alan Murphy, CEO of Sea-Intelligence, said this was equivalent of removing the third or fourth largest container lines from the market.
New ships will not come onstream for two or three years and the build-up of ships waiting to enter the US West Coast ports could take until April next year to clear.
Companies such as Walmart are taking matters into their own hands and chartering their own vessels, reports Reuters.
The retail giant is one of several companies looking to secure space and bypass logjams. Others include Target, John Lewis, Costco and Home Depot.
Meanwhile Coca-Cola has resorted to moving more than 60,000 tonnes of material on three bulk carriers due to a shortage of container ships, reports Splash 247.
Coca-Cola’s procurement director, Alan Smith, said: “When you can’t get containers or space due to the current ocean freight crisis, then we had to think outside the box.”