OCEAN FREIGHT CONTINUE TO RISE TO NEW RECORD.
13
May
Contract container freight rates published on the CCFI China Index last Friday hit 2,074 points and set a new record.
Contractual container freight rates published on the China Container Freight Index (CCFI) last Friday hit a new record at 2,074 points. The index once peaked at 2,072 points on February 19 after the Lunar New Year.
Since a new record of 2,072 was set in February, the CCFI slowly dropped to 1,853 on April 16, after which the ripple effect from the congestion of the Suez Canal began to have an impact.
Lars Jensen, founder of consulting firm Vespucci Maritime, noted in a LinkedIn post that contract prices are often lower than spot prices. Spot prices have been at new record levels for most of last month.
With reliability in container shipping plummeting and spot shipments increasingly difficult to book; So the ability to book has become a big concern when signing a contract this year.
Data from the New York Shipping Exchange (NYSHEX) shows that the concept of an enforceable contract has been of great interest on the trans-Pacific trade in 2021.
Market commentary and forecast
“In the broader market context, which reflects a market with a forecast for 2021 from a shipper perspective, it is clear that the market has moved into a supply chain recovery state, and there is There is a real concern that there may be phases where not everyone can guarantee transit reservations, ”noted Jensen of Vespucci Maritime on Friday.
Records in the container shipping industry are constantly being broken. For example, charter rates for container ships continue to rise – 4,400 teu ships can now hit $48,000 a day.
“Not only do shipowners consistently outperform their previous leases, they do so over a longer period of time,” the creators of Hamburg’s ConTex index said last Friday.
Despite the huge number of shipbuilding orders that have been placed in the past eight months, many analysts think the supply/demand situation in the sector remains favorable.
British broker Braemar ACM estimates world fleet expansion at 4.4% for the whole of 2021, up from 2.8% in 2020. Over the next 5 years with the current order book Currently, Braemar ACM predicts an average annual fleet growth of 3%. During the previous five-year period, the average annual fleet growth rate was 3.5%.
“Assuming an average annual trade growth of 3.5% for the five years 2021-2025 and an estimated average annual fleet growth of 3% (with the current order book), we can found that even with an additional 1.5 million TEUs delivered in 2024 and 2025, the supply curve will widen through the end of 2025. It seems quite logical that new shipbuilding investments go before the supply bubble appeared,” suggested Braemar ACM in a new report on containers.
Meanwhile, the Danish Shipping Finance Company forecasts that container demand may increase by 5-6% in 2021; and container volume at the end of 2021 will increase by 4% compared to 2019.
Finally, VesselsValue sees demand growth in 2021 up 5.3% from pre-Covid levels in 2019, compared to a 0.7% drop in 2020.
“The increase in demand was supported by continued online purchases, but is expected to ease as vaccination programs take hold and mobility returns to normal. Recovered manufacturing capacity in Western economies could support demand in the second half of the year and into 2022,” VesselsValue predicts in a new report, suggesting 2022 will see demand growth at a moderate healthy about 4%.
