Container prices take another step up

Average prices for container transport by sea have risen again. This is evident from the indices of Drewry and Freightos. Drewry's World Container Index rises 1,4% to $9.544 per 40-foot container. This is 82% higher than last year in the same period. Freightos reports that the average price for shipping from Asia to the west coast of the United States increased by 16%, to $14.572 per container. Transport to the east coast has become 6% more expensive, to $17.476 per container. This corresponds to the picture that Drewry paints. There, the costs for transport from Shanghai to Los Angeles or New York increased by 1% and 2% respectively.

When exporting from Shanghai to Rotterdam, $14.028 must be paid per container. That's an increase of 3% compared to last week. Fares on the Rotterdam-Shanghai and Rotterdam-New York routes were slightly lower over the past week. This concerns price decreases of 2% and 1% respectively. But this is not enough to compensate for the price increases of transport from Asia. Prices are expected to continue to rise in the coming weeks. New nuisance in shipping is the reason for this.

Shipping continues to experience disruption
This 'new' nuisance is largely caused by the strict quarantine measures in China, which are causing staff shortages. Regular preventive testing of dock workers and truck drivers also causes congestion. These congestions are visible in Shenzhen, Ningbo, Xiamen, Dalian and Tianjin, among others. As a result, freight capacity drops sharply; in Tianjin it is still 'only' 50% of normal. To prevent further problems, a new measure has been introduced in Shenzhen: containers are only delivered three days before the planned arrival of ships.

Many ships choose to head to the port of Shanghai, the largest container port in the world, to avoid delays at other ports. Of course, this also causes more and more congestion there. The sailing schedules have now been delayed by about a week. The average monthly end-to-end transition time between China and the United States has now increased to 50 days. That is 2020% longer than in December 85 and 2019% longer than in December XNUMX. A delay in sailing schedules is not only visible in Asia, this is also the case for transport from the European Union and the United States.

As described, both Drewry and Freightos expect container prices to continue to rise in the coming weeks. This is - in addition to port congestion - due to the fact that the most recent demand forecasts do not show a decrease in volume. In addition, the spread of the omikron variant of the coronavirus ensures that expenditure on goods remains above pre-pandemic levels. In other words: there is no way to eliminate the backlog.