- THE MAGAZINE
Container freight rates dropped for the fourth straight month in May 2013, reaching a 17-month low, according to the Drewry General Freight Rate Index. The Index provides a weighted average across all main trades (excluding intra-Asia). The Index dropped 9 percent in May to 41,882 per 40-ft. container.
The Asia-Europe trade lane suffered the most, though weak load factors affected rates on other routes as well.
China-Brazil rates were particularly hard hit, according to Drewry, dropping 28 percent to the lowest level since July 2009.
Rates were also down on Middle East/Indian Subcontinent routes, including China to the Middle East and export markets to Europe.
“Carriers’ failure to take the necessary corrective action to match capacity to weak demand through wider use of slow steaming or laying up ships is costing them dearly,” said the Drewry report. “But a new concerted effort to lift rates is likely to meet with some success.”
Areas where general rate increases appeared to be holding included the Transpacific Eastbound lanes and Asia to the Mediterranean. Drewry credited “An early start to peak season and carrier determination to restore spot rates before shippers sought renegotiation of higher contract rates were the primary driv-ers.”