Hopes of shipping rates revival dashed
Hopes of a revival in long-term ocean freight shipping rates have been short-lived after the latest data from Xeneta showed the market is once again in decline.
In September, the Xeneta Shipping Index, which tracks real-time rates developments on a month-to-month basis, revealed global long-term contracted rates had increased for the first time in 12 months.
It now appears September was a false dawn after the XSI dropped 2.6% to 165.3 in October.
“Carriers have had some success in capacity management, limiting the impact of the 3.3% decrease in global shipping volumes year to date,” commented Emily Stausbøll, Xeneta Market Analyst.
“However, this hasn’t been enough to support sustained rate increases on a global basis.”
The data showed unusual behaviours, particularly in the Far East, where Korea to Australia and New Zealand grew 2% in September before plummeting 31.1% in October.
Calm before the storm
Freight shipping companies have already endured 62.2% being wiped off market prices in the past 12 months and the situation may get worse before it gets better, warns Stausbøll
“I expect the storm to arrive in January with an even more severe decline on the XSI than 2023,” she said. “The picture is unlikely to be quite as dire for carriers by May, but 2024 still looks set to be a stormy time for them on the XSI.”
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