Asia-Europe rates hit an 11-month low

Freight rates on the major trades continued to fall last week and reports suggest this downward trend will continue as carriers begin to push back their October general rate increases to coincide with China’s Golden Week.
On the Asia-Europe trade, prices fell to their lowest level since the end of October 2013, according to the latest Shanghai Containerised Freight Index, decreasing for the fourth consecutive week by $86, or 9.5%, to just $822 per teu.
Prices on routes between Asia and the Mediterranean meanwhile followed a similar pattern, falling to $1,125, down 9.1% on the previous week.
Despite the seemingly low price on both routes, last week’s rates are still higher than in the same week last year, when rates to Europe and the Mediterranean from Asia were recorded at $765 and at $837.
Broker Freight Investor Services noted how carriers opting not to use the forward freight agreement could have secured an additional $372 per teu on the Asia-Europe trade in September.
Rates on the trade were previously trading at $1,350 per teu and the monthly average was as low as $979.
Rates from Shanghai to the US west coast meanwhile fell $156, or 7.5%, to $1,930 per teu, meaning that the average year to date rate is now $1,948, 8% down on the same period in 2013.
Across the other side of the country, freight rates on the US east coast dropped $213, or 5%, to $4,085 per feu.
After falling 61.44 points last week, the Comprehensive Index was recorded at 935.81 points to almost mirror the final week of September last year, at 936.89 points.
Ahead of Golden Week next month, Drewry’s Hong Kong-Los Angeles container freight rate benchmark decreased by just short of 10%, or $200, to $1,875 per feu.
Drewry expects rates to remain under pressure as the industry exits the peak season.